Yelp to Sell Eat24 for $287.5 Million

 

SAN FRANCISCO — Yelp has announced a partnership with Grubhub, the nation’s leading online and mobile food ordering company. As part of the agreement, Grubhub will acquire Yelp’s Eat24 business for $287.5 million in cash. Yelp will integrate online ordering from all Grubhub restaurants onto its platform.

Eat24, a competitor to Grubhub, was purchased by Yelp in 2015 for $134 million.

“Grubhub and Yelp, market leaders in their respective fields, have a shared mission of connecting consumers to local businesses. With such complementary goals and strengths, Jeremy and I are excited to form a partnership that will allow each company to focus on its respective expertise, while working together to expand local e-commerce for diners and restaurants,” said Matt Maloney, Grubhub’s founder and chief executive officer. “Adding Eat24’s large diner base and thousands of restaurants to our platform will accelerate Grubhub’s mission to become the most comprehensive marketplace connecting takeout diners and restaurants. The long-term agreement ensures that Grubhub also has access to Yelp’s enormous user base and clear content leadership to help drive more diners to our restaurants.”

“Bringing Grubhub onto the Yelp Platform through this long-term partnership will be a win for everyone. Consumers get a high-quality end-to-end experience with a wider selection of restaurants and better delivery options. Restaurant partners receive increased online exposure and the opportunity for increased order volume, as well as expanded delivery support. Yelp and Grubhub benefit from greater scale and sharper operating focus,” said Jeremy Stoppelman, Yelp’s co-founder and chief executive officer. “We expect Grubhub’s acquisition of Eat24 to create significant value for our consumers, restaurant partners and stockholders. The Eat24 team deserves credit for the transformational impact they’ve had as part of Yelp, and I’m pleased that we will continue to pursue this huge market opportunity in partnership with Grubhub.”

The acquisition will benefit diners, restaurants, Grubhub and Yelp:

  • Diners: Together, Grubhub and Eat24 will form the largest network of restaurants offering online and mobile food ordering in the United States. Diners will have the ability to discover and order from approximately 75,000 great local restaurants through either Grubhub’s or Yelp’s easy-to-use interface and take advantage of the industry’s lowest diner fees.
  • Restaurants: Connecting Grubhub’s unmatched restaurant network and efficient delivery infrastructure to Yelp’s large purchase-oriented audience will give Grubhub’s restaurant partners access to new potential diners and the opportunity for increased orders. Extending Eat24’s restaurants to Grubhub’s sizable diner network will help drive new diners and incremental revenue to Eat24 restaurant partners.
  • Grubhub: The combination of Eat24’s much-loved brand and significant reach will enable Grubhub to address more diners and drive more volume in all markets.
  • Yelp: The partnership adds tens of thousands of order-ready restaurants to the Yelp Platform and increases the availability of food delivery via Yelp, which will drive usage and transaction velocity in Yelp’s most highly-trafficked category.