Mobile ordering has grown rapidly and is seeing robust M&A activity. as we discover in the seventh part of Mergers & Acquistions’ 7-part series, Retail Tech M&A. Here’s our look at mobile payment processing: Mobile payment processing provides consumers with on-the-go convenience.
Uber Technologies Inc. (NYSE: UBER) plans to buy a majority stake in online grocer Cornershop, a deal designed to both extend its geographic reach and bolster profits by bundling food delivery with rides. Walmart Inc. (NYSE: WMT) announced its intention more than a year ago to purchase Cornershop outright for $225 million and re-sell it to its Mexican subsidiary, only to have Mexican regulators oppose it in June for antitrust reasons.
“Whether it’s getting a ride, ordering food from your favorite restaurant, or soon, getting groceries delivered, we want Uber to be the operating system for your everyday life,” says Uber CEO Dara Khosrowshahi.
DoorDash Inc. is bought food delivery app Caviar from Square Inc. (NYSE: SQ) for $410 million. Caviar’s complementary geographic footprint provides DoorDash with a significant number of new and unique customers, who will benefit from an even broader set of merchants, according to DoorDash.
“The acquisition further enhances the breadth of our merchant selection, enabling us to offer customers even more choice when they order through DoorDash,” says DoorDash CEO Tony Xu.
DoorDash reportedly received a $100 million led by T. Rowe Price Group Inc., a first-time DoorDash investor. SoftBank Group Corp., Sequoia Capital and Darsana Capital Partners previously invested in DoorDash.
Pizza Hut, a subsidiary of Yum! Brands Inc. (NYSE: YUM), announced plans to buy online restaurant ordering and delivery company QuikOrder in 2018.
“We’re doubling down on our commitment to digital and this deal positions Pizza Hut perfectly for the future,” says Pizza Hut CEO Artie Starrs. In Addition to Pizza Hut, Yum! owns the KFC and Taco Bell restaurant chains.
Restaurants are scrambling to meet the demands of the next generation of diners, who want more convenience such as online and mobile ordering, so they are ramping up those services through dealmaking.
With the holiday shopping season in full swing, all eyes are on the retail industry, which is undergoing transformational changes. Mergers & Acquisitions’ series examines the impact of 7 technologies on M&A in the retail sector. Read the whole series:
Retail Tech M&A #1: Nike, McDonald’s, PayPal, add customization, IoT
Retail Tech M&A #2: Why Walmart and other retailers are buying artificial intelligence startups
Retail Tech M&A #3: Amazon leads race to build fulfillment centers
Retail Tech M&A #4: Do robots fill orders faster?
Retail Tech M&A #5: Voice recognition gives retailers more ways to communicate
Retail Tech M&A #6: Data improves customer service
Retail Tech M&A #7: Demand for convenience drives growth in mobile ordering
We’ll continue watching how these technologies and trends play out in the M&A in the new year.