Deliveroo offers share hungry investors access to £50m ahead of IPO
Deliveroo will make £50m of shares available to its customers in its forthcoming IPO as part of a community offer.
From tomorrow, any Deliveroo customer who has placed an order with the takeaway service will be able to register their interest in applying for shares in any future floatation via their app.
This means that in order to take part, an investor must have placed at least one order with Deliveroo. To take part in the community offering, potential investors could download the app on Monday and make an order.
If a float is confirmed in the future, Deliveroo customers will be able to apply for up to £1,000 of shares.
If the shares are oversubscribed, Deliveroo said it will prioritise existing “loyal customers”, but will ensure “a mixture of new and existing customers benefit”.
Deliveroo founder and CEO Will Shu said: “Far too often normal people are locked out of IPOs, and the only participants are the institutional investors. I wanted to give as many customers as possible the chance to become shareholders.”
Deliveroo is expected to be the largest float in London this year in a major boost for the capital.
Deliveroo’s intention to float will be considered an endorsement of London as a tech hub in the face of growing competition from other European cities and the US.
AJ Bell investment director Russ Mould was happy to see Deliveroo extend its IPO to retail investors, but pointed out the retail offer was not without strings attached, as investors would have to make at least one order to qualify for the community offering.
“Some people wouldn’t dream of putting money in a company associated with junk food, but there will be others who see a big opportunity,” Mould continued. “A year of various lockdowns has fuelled demand for companies like Deliveroo and there is an expectation that habits formed during the pandemic will remain long into the recovery.
“All this suggests there is likely to be a bun fight for the £50m worth of customer shares in Deliveroo at the IPO offer.”
‘Thank you riders’
Deliveroo also intends to reward riders who have been with the business throughout the pandemic.
The takeaway company has set aside £16m in cash that will be made available on the day of the listing.
Payments of £10,000, £1,000, £500 and £200, or local currency equivalents, will be made available to riders who have been with Deliveroo for at least one year and completed at least 2,000 orders.
Deliveroo said the cash payment will be calculated by reference to the number of orders complete by each eligible rider, with the largest payments being made to those riders who have completed the highest number of orders in each market.
Deliveroo said hundreds of active riders would receive £10,000, with over half of those based in the UK.
“I want to thank our riders who have been working with us for years, delivering great food and such a fantastic experience for our customers. They have been central to our growth and will continue to be. Some of these riders have been with us since the start and I’m delighted that they can share in the excitement of the company’s next chapter,” Shu added.
Deliveroo had a stellar year as consumers turned to the takeaway app as their favourite restaurants and pubs were forced to close their doors due to lockdown.