Please ensure Javascript is enabled for purposes of website accessibility

Amazon-Backed U.K. Delivery Company Deliveroo Seeking Up to $2.45 Billion in London IPO

By Eric Volkman - Mar 22, 2021 at 8:17PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Amazon currently has a 16% stake in the service.

One of the hottest initial public offerings (IPOs) on the London market this year is sure to be that of Deliveroo, a delivery service backed by none other than (AMZN 2.57%). On Tuesday, Deliveroo set a price range for its issue of 3.90 to 4.60 British pounds ($5.40 to $6.37) per share.

The company plans to float up to 384,615,384 shares; if it does, the issue could total nearly 1.77 billion pounds ($2.45 billion) at the top end of that range. This would make it the U.K.'s largest IPO since September.

Deliveroo is a London-based company that delivers from a wide selection of restaurants and also fetches goods from grocery chains such as Aldi and Waitrose. Outside the U.K., it is active in 11 other countries in Europe, Asia, and the Middle East.

Face-masked delivery man presenting three containers of food.

Image source: Getty Images.

In May 2019, Amazon led a $575 million fundraising round in Deliveroo, which ultimately led to the U.S. retail giant taking a 16% stake in the company. It is unclear whether Amazon will participate in the upcoming IPO, and how the issue might affect the size of its stake. Amazon has not yet commented on Deliveroo's IPO pricing.

One offbeat aspect of the issue is that it will comprise a 50 million pound ($69 million) allotment for U.K.-based Deliveroo customers who have ordered at least once through the service. Each customer will be entitled to purchase up to 1,000 pounds ($1,386) worth of stock.

Deliveroo will use the net proceeds of the IPO to "invest in the growth opportunities available," including innovation and the further development of its premium service tiers.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned, Inc. Stock Quote, Inc.
$2,135.50 (2.57%) $53.50

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.