LONDON: Deliveroo said shares worth £50 million (US$69 million) would be earmarked for customers in its upcoming flotation, with the offer branded “Great food with a side of shares”.
The Amazon-backed food delivery firm announced plans on Thursday (Mar 4) to list in London, with a potential value of US$7 billion making it the biggest market debut in Britain for three years.
Founder and chief executive Will Shu said Deliveroo’s customers had supported the firm’s growth and he wanted to give them the chance to share in the next stage of its journey.
“Far too often, normal people are locked out of IPOs, and the only participants are the institutional investors,” he said on Sunday.
“I wanted to give as many customers as possible the chance to become shareholders, which is why we’re making £50 million of shares available to them, alongside our restaurant partners and riders.”
Deliveroo said any customer who had placed an order would be able to register their interest via the company’s app from Monday.
Each would be able to apply for up to £1,000 of shares, it said, adding that loyal customers would be prioritised if the offer were oversubscribed.
Russ Mould, investment director at online platform AJ Bell, said a year of lockdowns had fuelled demand for companies like Deliveroo and there was an expectation that habits formed during the pandemic would remain long into the recovery.
“All this suggests there is likely to be a bun fight for the £50 million worth of customer shares in Deliveroo at the IPO offer,” he said.
Deliveroo said it would also recognise the role played by its delivery riders in its success with a £16 million (US$22 million) reward programme to be launched on the day of listing.
The Thank You Fund will be available to active riders in Deliveroo’s 12 markets, with riders eligible based on the number of orders they have delivered.
“There will be payments of S$18,500, S$1,850, S$925, with all riders who have worked with Deliveroo for at least one year and completed 2,000 orders receiving S$370,” said the company in a press release.
Payments will be calculated by reference to the number of orders completed, with the largest payments going to riders who have completed the highest number of orders in each market.
The percentage of riders eligible for each award will be consistent across all markets, it added.
The average payment for each eligible rider will be S$815, while hundreds of active riders globally are set to receive the largest payment of S$18,500, said Deliveroo.
The company expects more than one-quarter of Deliveroo’s global rider fleet to benefit from the scheme, with more than 36,000 riders globally receiving cash payments.
“Riders are at the heart of our business, and we want to reward their efforts that have helped Deliveroo become what it is today,” said Shu.
“Over the last year riders have helped us do so much more than just deliver great food, having supported businesses and enabled vulnerable people or those self-isolating to stay safe indoors throughout a global pandemic. We’re pleased to be able to say thank you.”