Deliveroo shares soared on Monday morning after receiving a £2.7 billion takeover move from US rival DoorDash.
Shares in the company jumped by as much as 16% in early trading following confirmation of the approach late on Friday.
On Monday, Deliveroo also suspended its £100 million share buyback programme as a result of the takeover talks.
The takeaway delivery operator unveiled the buyback programme, which would have brought shareholder returns since 2023 to £550 million, in March.
It added that it could still recommence the programme at a later date.
The move comes after Deliveroo confirmed last week that it received an “indicative proposal” from US takeaway app firm DoorDash on April 5.
Bosses at Deliveroo said they would “be minded to recommend” the 180p per share proposal to shareholders, provided there was agreement on other terms.
DoorDash will need to make a firm offer by May 23.
Deliveroo, which was co-founded by chief executive Will Shu in 2013, operates in nine countries and works with about 135,000 riders across the world.
Mr Shu is reportedly in line for a £172 million windfall from his stake in Deliveroo if the deal is confirmed.
Analysts in the sector have suggested that other potential suitors could come forward with rival takeover offers.
Panmure Liberum analyst Sean Kelly said: “With good execution, Deliveroo could be a kingmaker asset for DoorDash in the UK and Europe.
“Yet, 180p is by no means a knockout valuation and so we see potential for Deliveroo to receive a counterbid.”
In February, major UK rival Just Eat said it would become private again after agreeing to a 4.1 billion euro (£3.4 billion) takeover by South African-owned firm Prosus.
