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Eat24 offers delivery service to local restaurants, will expand from 20K to over a million businesse
A couple of years back, Yelp decided to expand beyond just being a place to find and rate businesses, so it debuted a platform which allowed it to enter into partnerships with third-party businesses so that users could order goods, and make appointments, directly from the site.
Now Yelp has decided to take the next logical step and take over the delivery part of the business for itself. The company has now purchased Web-based food and delivery service Eat24, it was announced on Tuesday.
The total price of the deal was $134 million. That included 1.4 million shares of Yelp Class A common stock and $75 million cash. The transaction has already been approved by the boards of directors of both companies, and closed on Monday.
Founded in 2008, the San Bruno, California-based Eat24 offers online delivery and takeout services to local restaurants. Eat24 currently provides its services to approximately 20,000 restaurants in over 1,500 cities around the country, including New York, Miami, Philadelphia, Washington D.C., Atlanta, Denver, Las Vegas, Seattle and Austin.
With this acquisition, Yelp says that expand Eat24's offering to the one million U.S. restaurants listed on its platform. So Eat24 being acquired by Yelp will obviously mean scaling at a much faster rate than it would have on its own.
"We're excited to join the Yelp team to deliver an even better consumer experience inside this top destination for finding local businesses," Nadav Sharon, Eat24's co-founder and chief executive officer, said in a statement, "This is an incredible opportunity to further connect with Yelp's highly engaged users and to expand our reach to even more local businesses on its platform."
Along with Delivery.com, Eat24 was one of the first partners on Yelp Platform. And for Yelp, the acquisition allows the company to continue to branch out beyond being merely a reviews site.
"As a Yelp Platform partner, they’ve been a valuable driver of our growth in the restaurant category while continuing to build an impressive business of their own," Jeremy Stoppelman, Yelp co-founder and chief executive officer, wrote in a blog post.
"Online and mobile food ordering is still in its infancy and restaurant and food searches are extremely popular on Yelp. We believe that the acquisition of Eat24 will allow us to build a better, more seamless ordering experience for consumers that we can grow through 2015 and beyond."
This news comes a day after it was announced that Eat24 had partnered with Sidecar for its Sidecar Delivery service. There is no indication at to how this latest news will affect that relationship.
Shares of Yelp rose 5.9% on Tuesday, or $2.49, to $44.66 a share.
VatorNews reached out to both Yelp and Eat24 for further comment on the acquisition. We will update if we learn more.
(Image source: officialblog.yelp.com)
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