UAE's talabat acquires instashop from Delivery Hero for $32m

UAE delivery service talabat has completed the acquisition of Dubai-based grocery platform instashop from its German parent company Delivery Hero for $32 million, boosting its grocery and retail portfolio in the Emirates and Egypt.

The sale and purchase agreement, first announced in September last year, was fully funded through talabat’s internal cash reserves, the company said on Thursday.

It said the transaction brings its pro forma grocery and retail gross market value for last year to more than $2.5 billion. The move will unlock operational and technology efficiencies across both businesses, with integration activities already under way, talabat said.

Instashop was first acquired by Berlin-based Delivery Hero for $360 million in 2020, as it sought to expand in the Middle East and North Africa at the time.

"As part of the corporate restructuring carried out by Delivery Hero in September 2024, ahead of talabat’s initial public offering in December, and as an entity under common control, the agreed purchase price of instashop of $32 million reflects its capital amount [including subscribed capital and capital reserves] rather than its fair value," the statement said.

By integrating instashop’s platform, "we aim to create a more seamless and efficient delivery experience for our customers across the UAE and Egypt whilst also driving further product and technology synergies across our business", Tomaso Rodriguez, chief executive of talabat, said.

Instashop, which offers groceries, pharmacy items and beauty and personal care products, will continue to operate as an independent brand within talabat’s grocery and retail segment. That will allow cross-listing opportunities for partners to broaden their market reach, talabat said.

Last year, instashop's gross market value rose 16 per cent annually to about $631 million, it said.

Talabat is among a number of players in the UAE that caters to the key on-demand food and quick-commerce markets, as more consumers and businesses rely on convenience and choice. Its major rivals include London-based Deliveroo and Dubai unicorn Careem, which provide access to food, medicines, home services and payments.

Founded in Kuwait in 2004, talabat moved its base to the UAE in 2012, and operates in the Emirates, Kuwait, Qatar, Bahrain, Egypt, Oman, Jordan and Iraq. It has more than six million customers, 65,000 participating restaurants, grocers and other vendors, and more than 119,000 riders, according to its website.

It began trading on the Dubai Financial Market in December, following an IPO that raised $2 billion in the Gulf's biggest float last year, joining several regional companies raising funds through listings amid increased investor demand and continuing economic momentum. The listing attracted strong investor interest with a double-digit oversubscription level.

In its first set of financial results after the IPO, released in February, talabat reported that its fourth-quarter net profit surged 54 per cent year-on-year to $138 million, with revenue growing 32 per cent to $801 million. Adjusted earnings before interest, taxes, depreciation and amortisation rose 36 per cent to $139 million.

For the full-year, net profit leapt 64 per cent to $346 million, boosted by 32 per cent revenue growth to nearly $2.9 billion, with ebitda jumping 55 per cent to $497 million.

Talabat's acquisition of instashop will enable the latter to "leverage talabat’s extensive network and operational expertise", instashop chief executive Nikola Cabarkapa said.

"With talabat’s support, we can amplify our impact even further ... [and tap into] the significant customer and partner benefits this collaboration will bring."