DoorDash agrees to buy Instacart for $17bn, ad business included.

DoorDash has agreed to buy Instacart for $65 a share, valuing the grocery delivery company at about $17bn. Expected to close in late 2027 or the first half of 2028, the deal would put both companies' ad businesses and retail media tools under one owner.

The price is a 26% premium to Instacart's closing price on 22 October, the last trading day before media reports of talks. At least 75% will be paid in cash, funded by cash on hand and debt, with a JPMorgan bridge loan committed. Holders of about 19% of Instacart's shares have agreed to vote for the deal, which also needs antitrust clearance in the US, Canada and Israel. Instacart works with more than 2,200 retail banners covering nearly 100,000 stores, and runs its own marketplace, an Enterprise platform that powers grocers' own websites, and Instacart Ads.

Advertising is a big part of what DoorDash is buying. Instacart reported advertising and other revenue of $331m for the third quarter, up 23% and faster than the rest of its business, PPC Land reports. Instacart has suspended its guidance and cancelled its earnings call until the deal closes. The joint release pitches the combined company to grocers as a way to run their own websites and retail media networks, and to brands as a large alternative way to reach shoppers online.

What isn't settled: how the two ad platforms will be combined, what happens to the retail media networks Instacart runs for grocers under their own names, and whether regulators will accept the deal. The termination fee has not been disclosed.

The deal doesn't reach the Gulf directly. The model does. Retailers here are building their own ad businesses too, from Majid Al Futtaim's Precision Media at Carrefour to Panda Retail's work with Spike and GoWit. A US market where one delivery platform runs both its own ad network and its grocers' is a preview of the choice Gulf grocers face over who owns the shopper data.