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DoorDash tells employees not to connect with Instacart peers on LinkedIn. It’s an uncommon M&A ask

DoorDash tells employees not to connect with Instacart peers on LinkedIn. It’s an uncommon M&A ask

DoorDash told employees not to connect with Instacart peers on LinkedIn until their deal is closed.

Silhouetted attendees stand before a large red DOORDASH logo display at a presentation event.
DoorDash is telling employees not to connect with their counterparts at Instacart on LinkedIn.
  • DoorDash is telling employees not to connect with their peers at Instacart on LinkedIn.
  • The directive comes after DoorDash agreed to pay $17 billion to acquire Instacart.
  • It's an unusual ask during a deal, experts said.

DoorDash employees might have to make fewer LinkedIn connections as a result of their employer's $17 billion deal to buy Instacart.

The food-delivery service told employees as much in an internal question-and-answer document filed with the SEC on Thursday.

"Can I connect with Instacart employees on LinkedIn?" reads one of the questions in the document.

"Not at this time," the answer says. "Please do not request any new connections with any Instacart employees on LinkedIn, even if you have a prior relationship."

The guidance shows that a pending takeover can change life inside the companies involved, sometimes for long periods. Merging companies must remain independent competitors, limiting employees' ability to coordinate or share sensitive information.

The document tells employees not to accept LinkedIn connection requests from Instacart employees, and that the two companies must continue to operate separately until the deal closes. DoorDash and Instacart said they expect the purchase to close either at the end of 2027 or in the first half of 2028.

Companies planning a merger or acquisition will often take steps to prevent employees from engaging in so-called gun-jumping, or behaving as if the deal is already done, something that could thwart the deal before it's completed. This might include sharing competitively sensitive information, coordinating on pricing or bidding, or discussing jobs with people at the other company without authorization.

"You're supposed to continue to act like independent competitors until the deal closes," said David Gelfand, senior counsel specializing in antitrust law at Cleary Gottlieb, and former deputy assistant attorney general for litigation in the antitrust division of the US Department of Justice.

By asking employees to refrain from certain LinkedIn connections, the companies could be trying to prevent brain drain, said Chris Selland, a lecturer at Northeastern University's D'Amore-McKim School of Business.

DoorDash and Instacart already compete in the same industry. Discussions between employees could lead one company to hire employees from the other — bringing valuable connections, such as customer contacts, with them. "That could blow up the whole agreement," he said.

However, several M&A experts told Business Insider they'd never heard of employees at companies undergoing a deal being barred from connecting on LinkedIn or any other social media platform.

DoorDash didn't immediately respond to a request for comment.

Whether Instacart and DoorDash are acting sensibly, or imposing an overly broad restriction on ordinary employee behavior is "a great antitrust examination question," said William Kovacic, a former FTC chairman and the director of George Washington University's Competition Law Center.

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Read the original article on Business Insider