Amazon and Deliveroo Strengthen Ties with Prime Food Delivery Package

LONDON – Amazon on Wednesday announced its first major partnership with UK food delivery company Deliveroo since investing in the company two years ago, offering Prime customers free delivery on takeout orders from a certain amount for one year.

Millions of Amazon Prime members in the UK and Ireland will have access to the lower tier of the Deliveroo Plus service, meaning they will be entitled to free deliveries when the value of their orders exceeds £ 25 ($ 34).

The partnership comes after regulators from the French Competition and Markets Authority investigated Amazon’s investment in Deliveroo to see if it had any competition concerns.

Amazon’s investment was finally approved after regulators concluded that the deal did not present any significant competition concerns and that Deliveroo would struggle to survive without the investment.

He gave the e-commerce giant a 16% stake in Deliveroo, which is run by former Morgan Stanley banker Will Shu.

Amazon has 200 million Prime subscribers worldwide and an undisclosed amount in the UK and Ireland.

Deliveroo declined to say whether Amazon paid them any additional fees to be able to offer Prime members access to the Deliveroo Plus ‘silver’ tier, which normally costs £ 3.49 per month.

In May 2019, Deliveroo announced that it had raised a funding round of $ 575 million led by Amazon. Barely two months later, the CMA put the brakes on the case. Then, later in the year, the AMC launched a formal investigation to examine the potential anti-competitive implications.

When it began its investigation, one of the CMA’s main concerns was the possibility that the deal could prevent Amazon from re-entering the online restaurant market. Amazon previously operated an online takeout business called Amazon Restaurants, but then exited the market in 2019.

Deliveroo was listed on the London Stock Exchange in April with a market value of around £ 7.5 billion. But stocks fell about 25% on the day that trade opened. Shares have rallied somewhat since then and the company’s market cap now stands at £ 8.6 billion.

Amazon sold around £ 100million of Deliveroo shares when the company went public, reducing its stake from 16% to around 12%. However, the e-commerce giant remains its largest shareholder.

Lisa Leung, Director of Prime and Marketing at Amazon UK, said in a statement: “We are always looking for ways to deliver even more value to Prime members by providing them with the best in shopping and entertainment.”

She added: “This is why we are thrilled with this offer with Deliveroo – so that millions of Prime members in the UK and Ireland can enjoy the convenience of great meals delivered quickly.”