Online food delivery pioneer FreshDirect has been acquired by rival Getir as the industry continues to consolidate following the pandemic boom, the companies announced Wednesday.
Privately held FreshDirect, launched in the Big Apple in 2002, had been sold to Netherlands-based Ahold Delhaize, owner of the Stop & Shop supermarket chain, less than three years ago for between $200 million and $300 million. , industry experts told The Post.
JJ Fleeman, CEO of Ahold Delhaize USA, did not disclose the terms of the deal with Getir, which is expected to close by the end of the month.
“This was a difficult decision, especially given FreshDirect’s rich history in the New York City area,” Fleeman said in a statement. “However, our strength as a U.S. grocery retailer is the true omnichannel experience: a combination of online and in-store.”
FreshDirect’s 3,200 employees are expected to keep their jobs, Fleeman said.
The deal will help Turkey-based Getir expand its presence in New York City, just one of three cities (along with Boston and Chicago) where it operates in the United States.
“FreshDirect will leverage Getir’s technology… to offer faster services to its loyal customer base, who will also benefit from easy access to Getir’s fast and convenient service,” the companies said in a joint statement.
Getir has had its own financial problems after growing too quickly during the pandemic.
The company’s valuation has fallen to $2.5 billion from $11.8 billion just two years ago, according to a Financial Times report. But Getir, which counts private equity giant Sequoia as an investor, managed to raise $500 million this year.
Still, Getir shut down service in several European countries this year after imposing mass layoffs in 2022. It has also earned the ire of lawmakers for a host of problems, including its “dark stores” and drivers who rushed to make Deliveries in a matter of minutes in stores. expense of pedestrian safety.
FreshDirect had been criticized in recent years for failed deliveries of high-priced grocery items after its founding in 1999 in Long Island City. The company’s colorful trucks began cruising city streets in 2002 as the first grocery business to offer online shopping and delivery.
It was the brainchild of Fairway supermarket chain co-founder Joe Fedele and investment banker Jason Ackerman, whose late uncle Peter Ackerman, who worked alongside “Junk Bond King” Michael Milken at Drexel Burnham Lambert, was its principal. investor for many years.
In 2018, FreshDirect moved into a vast 400,000-square-foot facility in the Bronx, which some experts said was a costly decision that contributed to its struggles against growing competition from a new generation of grocery delivery companies that deliver in an hour or less, including Getir.
“It’s not a surprise that Ahold Delhaize divested itself of FreshDirect,” e-commerce consultant Brittain Ladd told The Post. “They couldn’t grow the business.”
