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Amazon Purchases Minority Stake in Grubhub to Bring Service to Prime Users

Amazon Purchases Minority Stake in Grubhub to Bring Service to Prime Users

Friday, July 8th, 2022

The food delivery sector is taking off, and Amazon is looking to tap into the opportunities it provides. Making another venture into foodservice, the grocery titan recently revealed a deal with Grubhub’s parent company Just Eat Takeaway, in which the retailer acquired a 2 percent stake in the food delivery platform.

Following the purchase, Amazon plans to fortify its Prime membership service with the addition of Grubhub access, in addition to expanding the user base for Grubhub+. According to Forbes, all Amazon Prime members in the United States will be granted one year of free access to Grubhub+. Grubhub+ is a subscription service that allows users to order food with zero delivery fees for $10 a month.

The grocery giant recently inked a deal with Just Eat Takeaway, the parent company of Grubhub, acquiring a 2 percent stake in the popular food delivery platform

Just Eat also revealed it is pursuing either a partial or full sale of Grubhub.

As a component of the deal, Amazon may choose to increase its stake in the company up to 15 percent. The deal is set to renew each year unless the company chooses to terminate it, the source noted.

This strategic play comes more than three years after Amazon shut down its own similar service in the U.S., called Amazon Restaurants. Last year, Amazon also signed a deal with Deliveroo to offer its free delivery service to Prime members in the United Kingdom and Ireland.

What other plays will we witness following this strategic transaction? Only time and Deli Market News will tell, so stay tuned.