Yelp Expands Into Online Food Ordering with Eat24 Purchase


Yelp Inc (NYSE:YELP) said it bought online food-ordering service Eat24, expanding its business beyond consumer reviews into one of the hottest sectors of the online economy.

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The acquisition of Eat24 for $134 million puts Yelp in direct competition with established operators such as GrubHub Inc.

Shares of the operator of the consumer review website rose as much as 7.5 percent to $45.30 in early trading on Tuesday.

Eat24 offers online delivery and takeout services to about 20,000 restaurants in over 1,500 cities across the United States.

Yelp said it paid $75 million in cash and about 1.4 million Class A shares for San Bruno, California-based Eat24.

Yelp raised its current-quarter revenue forecast to $118.5 million-$120.5 million from $114 million-$116 million.

The company also increased its full-year revenue forecast to $574 million-$579 million from $538-$543 million.

Analysts on average were expecting revenue of $115.7 million for the current quarter and $542.8 million for the full year, according to Thomson Reuters I/B/E/S.

Yelp, faced with maturing growth in the United States, has been stepping up efforts to expand in international markets, without much success.

(Reporting by Subrat Patnaik and Lehar Maan in Bengaluru; Editing by Savio D'Souza)