Grubhub Owner Wonder Reportedly In Talks For $500M Debt Refinancing

Wonder, the parent company of Grubhub, is reportedly in talks with lenders to raise between $400 million and $500 million to refinance the food delivery platform’s outstanding debt.

According to a report by Bloomberg, the company has approached private credit firms and is exploring financing terms that would include a payment-in-kind (PIK) feature. 

It added that the structure would allow Wonder to defer a portion of its interest payments until the debt matures, reducing immediate cash obligations. The proposed financing would carry an interest rate of around 13%, including the PIK component.

The report noted that private credit lenders usually offer PIK structures to fast-growing technology companies that have predictable revenue, particularly those still investing heavily in customer acquisition and product development.

The report also noted that private credit lenders have considered financing proposals for Grubhub in the past, but a deal was never completed.

Bloomberg data showed that Grubhub currently has $500 million of notes outstanding, originally issued in 2019 with a 5.5% coupon. The maturity date for these notes is July 2027.

Wonder acquired Grubhub in 2023 from Just Eat Takeaway.com for approximately $650 million, comprising $150 million in cash and the assumption of $500 million in debt. The company has since been working to reposition Grubhub within the increasingly competitive food delivery sector.

Recently, food delivery has faced regulatory pressure, particularly in New York City, where a cap on fees that platforms can charge restaurants has tightened profit margins. 

Grubhub, DoorDash (DASH), and Uber Technologies (UBER) recently agreed to settle a lawsuit over the feed cap in exchange for proposed changes to the law, which the city is expected to introduce later this year. 

Bloomberg said that Wonder declined to comment on the report.

The Consumer Discretionary Sector Select SPDR Fund (XLY) moved 0.6% higher in midday trade on Friday. On Stocktwits, retail sentiment around the ETF was in ‘bearish’ territory. 

Get updates to this developing story directly on Stocktwits.

Read also: Humana Loses Lawsuit Over Medicare Bonus Cuts, Stock Slides

For updates and corrections, email newsroom[at]stocktwits[dot]com.