Postmates Inc has revived plans for an initial public offering following dealmaking in the U.S. online food delivery service sector that sparked acquisition interest in the company, according to people familiar with the matter.
Postmates had struggled to generate the revenue growth required to excite IPO investors. But the COVID-19 pandemic buoyed its fortunes, as consumers who are staying at home order meals from restaurants or have their groceries delivered.
Postmates has received acquisition offers from other companies, including ride-sharing giant Uber Technologies Inc and a so-called blank-check acquisition vehicle led by investment banker Michael Klein, according to the sources.
Postmates registered its IPO confidentially with the U.S. Securities and Exchange Commission in February 2019 but did not proceed with a stock market debut.
Just Eat Takeaway.com NV’s $7.3 billion deal to acquire GrubHub Inc earlier this month, as well as recent fundraisings by peers, convinced it that the time had come to press ahead, the sources said.
Postmates could make its IPO registration public as early as July, kicking off what is typically a process lasting only few weeks until it goes public, the sources said. The company will decide in the coming days whether it wants to pursue the IPO or sell itself, one of the sources added.
The sources requested anonymity because the matter is confidential. Postmates and Uber declined to comment. The New York Times first reported on Uber’s offer for Postmates.
Postmates was last valued at $2.4 billion, when it raised $225 million in a private fundraising round last September.
Founded in 2011, San Francisco-based Postmates accounted for 8% of the U.S. meal delivery market in May, with DoorDash leading with a 44% market share, according to analytics firm Second Measure.
In early June, DoorDash raised $400 million from private investors at a valuation
of $16 billion. Also this month, grocery delivery startup Instacart nearly doubled its valuation to $13.7 billion with a private fundraising round.