Amazon Acquires Grubhub Stake, Adds Food Delivery Benefits to Prime

Food delivery workers on bicycles ride down the street in New York City, USA on Tuesday, March 17, 2020.

Debetrius Freeman | Bloomberg | Getty Images

Amazon on Wednesday agreed acquire a stake in Grubhub in a deal that will also give members of its Prime subscription program a year’s membership to the food delivery service.

The partnership gives Amazon the opportunity to acquire a 2% stake in Grubhub, the US subsidiary of Just Eat, the European food giant. said. Amazon will be able to increase its total share of Grubhub up to 15% depending on certain performance factors such as the number of new customers added.

News of the deal sent delivery platform shares down. Ubershares fell more than 3%, and shares DoorDash dropped by as much as 9%.

Amazon is sweetening the perks of its Prime program, which has more than 200 million members and already includes some food-related benefits, such as grocery discounts at Whole Foods. Prime members will now be able to waive shipping fees on some Grubhub orders and access other Grubhub loyalty program benefits at no additional cost.

“With this offer, the value of a Prime membership continues to grow,” said Jameel Ghani, vice president of Amazon Prime. in a statement.

The agreement was signed by the Dutch company Just Eat. studies the sale Grubhub amid pressure from investors to improve their business. just eatshares have fallen over 60% this year.

Amazon has previously experimented with adding food delivery perks to Prime. In September it announced a collaboration with European delivery company Deliveroo that gave Prime members in the UK and Ireland access to Deliveroo Plus for one year. Amazon made a bet 10 weather forecast for Deliveru.

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