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DoorDash has entered into an agreement with Square to purchase Caviar, a food delivery and on-demand catering business. DoorDash has agreed to pay Square $ 410 million in cash and preferred shares DoorDash.
Square bought Caviar about five years ago for an amount of about $ 90 million. Now caviar DoorDash, the new on-demand delivery company that has been under fire for months, has found a new home to pay for its delivery workers. DoorDash finally did well with its workers last week.
"Today's announcement is another important step forward in our mission of empowering local economies," DoorDash CEO Tony Xu (pictured above) said in a statement. "We have long admired Caviar, which has a coveted brand, an exceptional portfolio of upscale restaurants and cutting-edge technology. The acquisition further expands our selection of merchants, allowing us to offer even more choice to customers when ordering through DoorDash. We are looking forward to welcoming the Caviar team at DoorDash and extending our partnership with Square in the future. "
We are excited to welcome Caviar into our family and work together to achieve our shared vision of empowering local economies. https://t.co/MGCGYdVhvT
– DoorDash (@DoorDash) August 1, 2019
The leading players in the on-demand food distribution sector are now DoorDash / Caviar, Postmates, UberEats and GrubHub / Seamless. In May, DoorDash raised $ 400 million worth $ 12.6 billion. Postmates, who are now easily a major DoorDash competitor, is currently worth about $ 1.85 billion and has been privately filed for a public announcement earlier this year. However, this IPO has not yet taken place.
With Caviar joining DoorDash, Gokul Rajaram, Square's manager at Square, along with all other Caviar employees, will join DoorDash at the closing of the acquisition. The transaction is expected to close this year.
"Caviar has built a brand of trust with customers and many of the best restaurants," Rajaram said in a statement. "DoorDash has a national reach, a selection of complementary restaurants, a great logistical platform and a team that shares our pbadion and commitment to better serve restaurants, smugglers and customers. I am extremely excited to join, along with the rest of the Caviar team, to help build the future of local commerce. "
For Square, the deal gives the company an opportunity to focus more on its business and consumer products, said Square CEO Jack Dorsey.
"We are focusing more on our two large and growing ecosystems – one for businesses and one for individuals," said Dorsey. "This transaction reinforces this effort and we believe the partnership with DoorDash provides strategic and valuable opportunities for Square."
It should be noted that this is not the first time Square has been trying to get rid of caviar. In 2016, Bloomberg announced that Square wanted to sell Caviar for $ 100 million but had not found a buyer.
Meanwhile, Square reported net income of $ 1.17 billion for the second quarter of 2019 (up 44 percent year-over-year), adjusted revenue of $ 563 million (46 percent year-over-year growth). and a net loss of $ 7 million. In his letter to shareholders, Square described how it would become clearer how the company works.
"In addition, DoorDash is already integrated with Square for Restaurants, which simplifies the acceptance of online and in-person orders from merchants. In the second quarter, Cash Boost is badociated with DoorDash to offer instant rewards when customers use their credit card on DoorDash. We are confident that the continuation of this partnership provides strategic and valuable opportunities for Square. "
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