US Stock Market Move | $17 billion acquisition of Instacart enters countdown as DoorDash (DASH.US) rises over 6%.

On Thursday, US food delivery provider DoorDash (DASH.US) opened higher, rising more than 6% as of press time. On the news front, DoorDash released its third-quarter results before the US market open: third-quarter revenue was $4.62 billion versus expectations of $4.56 billion; it expects fourth-quarter marketplace gross order value (GOV) of $35.4 billion to $36.4 billion, versus market expectations of $35.77 billion. In addition, DoorDash said in a statement that it has agreed to acquire Instacart at a valuation of approximately $17 billion. DoorDash will pay consideration of $65 per share in a cash-plus-stock deal. For DoorDash, already the leading US restaurant delivery app, the acquisition of Instacart would expand its presence in the online grocery delivery market. CEO Tony Xu recently described the grocery delivery business as the company's fastest-growing segment. If the deal closes, DoorDash is expected to simultaneously expand consumer use cases, deepen merchant services, and strengthen retail advertising capabilities. Restaurant users could be directed to grocery shopping, and Instacart's household-stocking users could also increase other local spending; if membership benefits, customer acquisition spending, and fulfillment resources can be effectively coordinated, the platform would have the opportunity to increase its share of user spending, reduce repeat customer acquisition costs, and generate additional revenue from more transactions through advertising and merchant tools. However, these are potential post-merger synergies, and for now simply adding orders together cannot be directly equated with increased profit.