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Amazon adds Grubhub food delivery to its website, app in the US

FILE PHOTO: Illustration shows Amazon logo

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(Reuters) -Amazon.com on Thursday said its customers in the U.S. can now order from Grubhub directly on its shopping app and the website, extending a deal that already offers its Prime members a no-fee access to Grubhub+ membership.

As part of the agreement, Amazon Prime members will continue to be eligible to avail a free Grubhub+ membership worth $120 a year, which includes free delivery on orders above $12.

Amazon already offers no-fee access to Grubhub, which is owned by Just Eat Takeaway.com, to U.S. Prime members. The initial deal was struck for a year in 2022 and then the companies extended it for a year in 2023.

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The new deal bundles the Grubhub membership with Prime and integrates it on its app and the website. It will remain available to the loyalty users "every year thereafter as long as they remain with Prime," Amazon said.

Prime membership in the U.S. costs $139 a year and includes free delivery, gaming benefits, savings and discounts on medical prescriptions at nearly 60,000 pharmacies, access to Amazon Music, Prime Video and Prime Reading.

Amazon had secured the right to buy a 2% stake in Grubhub in July 2022.

In a separate statement, JustEat Takewaway said Amazon has received warrants representing 4% of Grubhub's equity and may also receive warrants up to a further 10% of Grubhub’s equity based on certain performance conditions.

"The important impact of this deal is that it makes GrubHub more attractive to a potential buyer, as Just Eat Takeaway has been attempting to sell it for some time now – since shortly after it made the initial acquisition," Sean Kealy, an analyst at Panmure Gordon, said.

About 167 million Amazon customers in the U.S. subscribed to Prime in 2023, representing approximately 71% of all users in the country, according to data platform Statista.

(Reporting by Utkarsh Shetti, Shubham Kalia in Bengaluru and Piotr Lipinski; Editing by Nivedita Bhattacharjee)