Wolt Acquisition: Key Details, Impact, and What Comes Next

DoorDash's acquisition of Wolt marks a significant milestone in the food delivery industry. This all-stock transaction, valued at approximately €7 billion, expands DoorDash's reach to 27 countries. The merger aims to enhance product development, market focus, and value for consumers, merchants, and couriers globally, positioning DoorDash as a formidable player in the international market.

What Is Wolt?

Founded in 2014, Wolt specializes in food and grocery delivery, offering services like Wolt+, Wolt for Work, and Wolt Drive. Its unique selling points include responsible delivery practices, flexible courier partnerships, and risk-free merchant memberships. Wolt also provides comprehensive support for merchants, handling marketing, payments, and delivery. The award-winning app, highly rated on AppStore and Google Play, and excellent customer service further differentiate Wolt in the competitive delivery market.

Who Acquired Wolt?

DoorDash operates as a prominent food delivery and takeout service, connecting customers with local restaurants, grocery stores, and other retailers. Key services include food delivery from local eateries and popular chains, grocery delivery, and convenience store items. Additional offerings encompass package pickup, flower delivery, alcohol delivery, and pet supplies. DoorDash holds a leading position in the U.S. market, recognized as the "#1 Food and Drink App," and partners with a diverse range of businesses to enhance customer convenience and business growth.

When Was Wolt Acquired?

DoorDash completed its acquisition of Wolt on June 1, 2022. The deal, initially announced on November 9, 2021, came during a period of significant industry shifts driven by the global pandemic. This timing allowed DoorDash to leverage Wolt's operational expertise and market reach, aiming to enhance its international presence and accelerate product development. Despite the strategic benefits, the acquisition faced challenges due to a downturn in the stock market, impacting the overall value of the transaction.

Why Was Wolt Acquired?

• Market Expansion: The acquisition of Wolt significantly broadens DoorDash's market presence, extending its reach to 27 countries. This strategic move allows DoorDash to tap into Wolt's established markets, particularly in Europe, enhancing its global footprint and accelerating international growth.
• Technology Integration: Wolt's advanced technology, including its highly-rated consumer app and logistics optimization tools, will be integrated into DoorDash's platform. This integration aims to accelerate product development, improve service delivery, and enhance the overall consumer experience.
• Competitive Advantage: By combining resources and expertise, DoorDash and Wolt aim to create a stronger platform for local commerce. This merger is expected to enhance operational efficiency, drive substantial growth, and provide a competitive edge in the global food delivery market, empowering local economies and improving customer experiences.

Acquisition Terms

• Acquisition Price: The acquisition was valued at approximately €7 billion ($8.1 billion).
• Payment Method: The transaction was completed as an all-stock deal.
• Key Conditions or Agreements:
  • Wolt CEO Miki Kuusi will oversee the combined company's operations outside the United States.
  • The Wolt consumer app will continue to operate separately, supported by DoorDash's resources.
  • A new retention pool of approximately €500 million is reserved for Wolt management and employees.
  • The transaction is subject to customary closing conditions, including applicable regulatory approvals.
  • The shares were initially valued at $206.45 each at the time of the deal announcement, but their value has since dropped to $73.63 each.
  • There is typically a six-month lock-up period preventing investors from selling their shares immediately, but this lock-up was described as modest in this deal.

Impact on Wolt

The acquisition of Wolt by DoorDash has led to significant changes in operations and management. Miki Kuusi, Wolt's CEO, now oversees DoorDash's international operations, reporting directly to DoorDash CEO Tony Xu. Despite the merger, the Wolt consumer app continues to operate independently, supported by DoorDash's resources. This strategic decision allows Wolt to maintain its operational identity while benefiting from DoorDash's extensive infrastructure and market reach. The combined entity aims to leverage Wolt's technological innovations to enhance product development and market focus, driving substantial growth in the global food delivery market.

Regarding product offerings and services, the acquisition has accelerated the development of new features and improved service delivery. Wolt's existing services, such as Wolt+, Wolt for Work, and Wolt Drive, remain intact, ensuring continuity for customers and merchants. Employee reactions have been generally positive, bolstered by a €500 million retention pool aimed at retaining key talent. Customer feedback has also been favorable, with many appreciating the enhanced service capabilities and broader market reach. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly, ensuring a smooth and efficient transition.