Yelp acquired Eat24, a web and app-based online food ordering service for $134 million. The company said the acquisition will help boost daily engagement in the key restaurant vertical.
Eat24 provides online delivery and takeout services for approximately 20,000 restaurants in more than 1,500 cities across the United Sates. Yelp plans to expand Eat24’s offering to the one million restaurants in the country listed on its platform.
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Yelp said the app and website of Eat24 is intuitive with unrelenting focus on customer experience. Eat24 offers 24/7 live chat, email and phone support to allow customers place their orders easily.
Details of the acquisition
According to Yelp, the $134 million acquisition price is composed of 1.4 million shares of Yelp Class A common stock and $75 million in cash.
The board of directors of both companies approved the transaction, which is expected to close on February 9, 2015. Yelp will record the amount of the acquisition in its financial statement for the first quarter of 2015.
Yelp Stoppelman, co-founder and CEO of Yelp said, “Eat24 has developed a great solution and unique service that has already added great value to the Yelp platform”.
“With this acquisition, we gain more tools and expertise to help engage our users from discovery through transaction in a key vertical for Yelp,” added Stoppelman.
On the other hand, Eat24 co-founde and CEO Nadav Sharon said, “Yelp has an impressive ability to connect its users directly with businesses. 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.”
Yelp business outlook
Yelp adjusted its previous outlook for the first quarter and full year 2015. The company increased its revenue outlook for the first quarter in the range of $118.5 million to $120.5 million. The company still estimated that its adjusted EBITDA will be around $19 million to $21 million.
Yelp raised its net revenue guidance for the full year 2015 in the range of $574 million to $579 million. The company also increased it adjusted EBITDA guidance in the range of $102 million to $105 million.