#Deliveroo eyes £8.8 bn valuation at London float

Meal delivery app Deliveroo is aiming for a valuation of up to £8.8 billion when it shortly launches on the London stock market, the company said Monday.

It comes as the Amazon-backed British company, in line with other home-delivery firms, said it had seen demand soar in the past year amid coronavirus lockdowns.

The big listing, expected in April, is seen as a major boost to London’s financial sector which has been roiled by Brexit.

London’s financial sector, known as the City, recently lost its European share trading crown to Amsterdam following Britain’ exit from the European Union.

Eight-year-old Deliveroo’s market capitalisation on listing is set to be between £7.6 billion and £8.8 billion ($10.5 billion-$12.2 billion, 8.9 billion euros-10.3 billion euros), it said in a statement.

“We are proud to be listing in London, the city where Deliveroo started,” company founder and CEO Will Shu said in a statement.

“Becoming a public company will enable us to continue to invest in innovation, developing new tech tools to support restaurants and grocers, providing riders with more work and extending choice for consumers,” he added.

The offer price range has been set at between £3.90 and £4.60 per share, Deliveroo said.

It will sell around £1.0 billion worth of new shares, while current stakeholders plan to divest parts of their stock.

The listing update was published alongside news that Deliveroo’s app transactions ballooned by 121 percent in the first two months of the year compared with January-February 2020.

‘Strong start to 2021’

“We have seen a strong start to 2021 and we are only at the start of an exciting journey in a large, fast-growing online food delivery market, with a huge opportunity ahead,” added Shu.

Deliveroo earlier this month announced that it made an underlying loss of £223.7 million in 2020.

That was despite the value of transactions rocketing 64 percent to £4.1 billion.

Since its London launch in 2013, Deliveroo has expanded into mainland Europe, Asia, Australia and the Middle East.

Last year, more than six million people ordered food and drink every month from its app via 115,000 cafes, restaurants and stores.

However, its business model has come under scrutiny, including in Britain, France and Spain, as its freelance delivery riders complain about working conditions, reflecting wider concerns over their rights in the gig economy.

Britain’s antitrust regulator last year approved Amazon’s 16-percent investment in Deliveroo after an in-depth probe concluded it would not harm competition.

Deliveroo has said that some £50 million of it shares will be made available for customers, with delivery riders and restaurant partners also able to participate.

© 2021 AFP