Deliveroo is seeking a valuation of between £7.6bn and £8.8bn when it lists its shares on the London stock market.
The food delivery platform has said it plans to sell its shares for between 390p and 460p, in what will be the largest UK stock exchange offering in more than seven years.
It also said on Monday the total number of orders in January and February more than doubled from last year.
Big Opportunities Ahead
Founder Will Shu said there were “big” opportunities ahead.
Demand for food takeway and delivery increased during the coronavirus pandemic, after measures to shut down operations for the first time last year and restaurants were forced to close.
Restrictions on hospitality businesses in England are currently expected to begin to ease on April 12 early.
Deliveroo – which has yet to announce the profit – said it would use the proceeds to invest in the business.
Business Presence
The company was founded in London in 2013, and operates in more than 200 cities and towns in the UK.
It operates internationally in 12 countries, continental Europe, Asia, Australia and the Middle East.
Deliveroo said there are very big opportunities in the expansion market. “The way we think about it is simple: there are 21 meal occasions in a week – breakfast, lunch, and dinner – seven days a week. Right now, less than one of those 21 transactions takes place online. We are working to change that.”
Initial Public Offering
Deliveroo will sell about £ 1bn of new shares, and current shareholders will use the opportunity to sell some of their shares.
On Sunday, Mr Shu told Sky News he would withdraw part of his 6.2% stake in the business, which could be valued at £ 550m.
Customers who place at least one order at Deliveroo will have the opportunity to purchase shares in the business, with what the company calls “loyal” customers a priority.
Deliveroo also plans to reward its busiest riders with up to £ 10,000 bonuses.
Riders who have delivered the most orders will share in a £16m fund, the company has said.
Gig Economy Debate
Deliveroo drivers in the UK have been at the forefront of this debate over new ways to operate in the “gig” economy. Some drivers have taken industrial and legal action to improve their salaries and conditions.
A recent court decision confirming worker status in the UK for gig economy giant Uber put down a new marker for workers’ rights in this evolving sector. The Court of Appeal ruled that Uber’s drivers should receive holiday pay, pension contributions and the minimum wage.
Uber last week said it would introduce these payments.
Susannah Streeter, from stockbrokers Hargreaves Lansdown, said the employment situation of its drivers and the fierce competition between the food supply companies would be two positive outcomes for the company.
Deliveroo is competing with Uber Eats, Just Eat and a host of others. Just Eat has already announced its intention to strengthen operations in the UK.
“Just Eat takeaway has also pledged to stop using the gig economy model and offer UK workers hourly wages, sick pay and pension contributions. This is in stark contrast to Deliveroo which has so far seen off challenges in the courts to its self-employment model… it’s clear the challenge to Deliveroo’s contractor model is likely to continue.”
