Blue Apron to be acquired by Wonder Group for $103 million
Scott Eisen | Getty Images News | Getty Images
Meal kit business Blue Apron announced Friday it has agreed to sell itself to food and restaurant company Wonder Group, founded by entrepreneur Marc Lore, for $103 million.
The deal, at $13 per share, represents a significant premium from Blue Apron’s per-share price at Thursday’s close of $5.49.
The sale caps years of ups and downs for Blue Apron, once a leader in at-home meal deliveries. In recent months, the company has transitioned to become a more asset-light business, selling its operational infrastructure to California-based meal provider FreshRealm for $50 million and laying off significant swaths of its workforce.
“The Blue Apron brand and products that our customers know and love will stay the same, with more opportunity for product expansion in the future,” Blue Apron CEO Linda Findley said in a statement Friday.
A checkered past
Blue Apron has long been mired in strategic difficulties since its mid-2010s heyday.
The company was founded in 2012, billing itself as an easier way to prepare home-cooked meals. Boxes arrived at the customer’s doorstep with pre-portioned ingredients and recipes to create their chosen dishes. The company specifically targeted working professionals in large cities who may have less time to grocery shop and cook.
In 2015, the company secured $135 million in funding from big name backers including Fidelity Investments at a valuation of $2 billion, the Wall Street Journal reported at the time. The company even turned a profit in the first two quarters of 2016, wowing potential investors ahead of an eventual IPO.
Blue Apron went public in June 2017 at $10 a share and a valuation of about $1.89 billion. The company initially forecasted a range of $15 to $17 per share, but lowered its projected per-share price following Amazon’s acquisition of Whole Foods Market, announced just weeks before the IPO.
Blue Apron stock gained little ground on its opening day.
By then, the tide had already begun to turn for the meal kit business. Blue Apron reported a loss of $52 million in the first quarter of 2017 on $245 million in revenue. That single quarter of losses rivaled the company’s full-year deficit from 2016 of $54.9 million.
Competition intensified for Blue Apron, as other meal kit businesses popped up on the scene like HelloFresh and Home Chef. Blue Apron still dominated 40.3% of the market, Verge reported at the time, but had lost 17% of its share since September 2016. HelloFresh trailed behind at 28% market share.
Shortly after the IPO, a number of shakeups took place within the company’s top executives. Co-founder and then-Chief Operating Officer Matthew Wadiak stepped down from his post less than a month after the IPO, and CEO Matt Salzberg was replaced by chief financial officer Brad Dickerson later that year, while Salzberg became executive chairman.
By the end of 2017, the situation looked bleak: The company said in its 2017 year-end report that it had lost 15% of its customer…
Read More: Blue Apron to be acquired by Wonder Group for $103 million
