German express delivery startup Gorillas finalized the closing of its first acquisition deal for the French delivery start-up Frichti for undisclosed terms, according to multiple media reports.
Founded in 2015 and already profitable, Frichti offers operational efficiency and expertise around the private label and ready-to-eat segments. It delivers fresh groceries, private label products, and ready-to-eat meals to over 450,000 customers in eight key cities in France and Belgium.
The combined entity would grow Gorillas’s overall presence in the food delivery space and give it a 17.1% share for same-day grocery delivery in Paris, second behind leader Casino Guichard-Perrachon. Frichti also has a line of 120 products under the Frichti Everyday label, including beer, biscuits, ham, and eggs.
See also: Gorillas to Snap Up Frichti for Bigger Slice of Food Delivery Pie
The close of Gorillas’s first acquisition deal doesn’t signal the start to a flurry of M&A activity, Gorillas Chief Financial Officer Elmar Broscheit said in an interview with Germany’s Boersen-Zeitung, Bloomberg reported.
“Of course, we are constantly looking at M&A opportunities. But we have a very disciplined approach. A purchase is always stressful for the organization. We only want to do something where we can also draw out know-how for ourselves – not just a few warehouses with additional cash burn, “Broscheit said.
Founded in 2020, Gorillas has raised $ 1.3 billion at an estimated valuation of $ 3 billion as of October 2021. It operates across the UK, US and France.
The workforce has grown from 400 to around 14,000, mostly drivers due to the seventeen-fold increase in orders from January to December 2021. The fast growth in order volume led to driver strikes.
“This is a topic from which we have learned a lot. We are an employee-centric company and seek constructive dialogue with our drivers, “said Broscheit.
Read more: Grocery Delivery Startup Gorillas Looks to Raise $ 700M
Gorillas is concentrating on its next round of financing, so it has more than enough capital for future growth targets.
“Specifically, we are planning to raise 700 million dollars or more, which will enable us to continue to achieve our profitability goal,” Broscheit said.