Deliveroo IPO: Confirms London Floatation with Dual Share Structure

Deliveroo Confirms London Stock Market Floatation

Deliveroo, the food delivery startup, has officially announced its intention to list on the London stock market. This development had been anticipated for some time.

The company, established eight years ago, previously held a valuation exceeding $7 billion in June of the prior year.

Dual-Class Share Structure

Deliveroo intends to utilize “dual-class” shares for its listing. While currently restricted within the exchange’s premium segment, approval of recent regulatory recommendations could facilitate their transfer.

The U.K. government is advocating for dual-class shares to deter U.K. companies from listing on the Nasdaq and to attract listings from continental Europe. This share structure is prevalent in the U.S., employed by companies like Facebook and Alphabet, enabling founders to maintain greater control and pursue long-term strategies, particularly during mergers and acquisitions.

CEO Statement

Will Shu, CEO of Deliveroo, expressed his enthusiasm, stating: “Deliveroo originated in London. It was here that I launched the company and fulfilled our inaugural order.”

He further added, “London provides an excellent environment for living, working, conducting business, and enjoying dining experiences. I am immensely proud and excited about the prospect of a listing in this city.”

Growth and Expansion

Deliveroo experienced significant growth during pandemic-related lockdowns, achieving six consecutive months of profitability. The company now focuses on expansion initiatives.

These plans encompass expanding its network of “ghost” kitchens, enhancing its on-demand grocery services, broadening the reach of its Plus subscription program, and offering the Signature service to restaurants, allowing direct delivery orders through their websites.

Political Context

The timing of Deliveroo’s listing, following the British government’s approval of recommendations for dual-class shares, suggests a degree of political influence. The announcement was accompanied by a supportive statement from the Chancellor of the Exchequer.

Claudia Arney, chair of Deliveroo, commented: “The temporary dual-class structure will provide Will and his team with the assurance needed to execute their ambitious growth strategy and establish Deliveroo as the leading online food company.”

Impact on The City

This multibillion-pound IPO is expected to bolster The City of London’s position after Amsterdam surpassed it as Europe’s largest share-trading center in January, following Brexit.

Deliveroo secured a $7 billion valuation in January after raising $180 million from investors.

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