Former GrubHub owner and food delivery business Just Eat Takeaway has been acquired up by a backer of German rival Delivery Hero for $4.2 billion
Just Eat’s board unanimously approved the takeover by the South African-owned internet investor Prosus, just two months after it left the London Stock Exchange.
And the all-cash deal comes six years after Prosus first made its first effort to buy the British part of the business and the deal will be worth $21.25 a share for holders of Just Eat’s Amsterdam-listed shares, a 22% premium on its three-month share price high, but just a fifth of its peak of around $105 in 2020.
Just Eat was a star of the pandemic as its valuation rose as people turned to food delivery during the lockdowns but was hit as the boom faded and after previous consolidations failed to drive value in the business.
It was not alone, Turkish Getir left Europe and the U.S, last year after rapid expansion.
Compounding matters, the company then made some poor decisions, most notably the disastrous acquisition of its U.S. rival GrubHub at the height of the pandemic bubble. Late last year Just Eat confirmed it was selling GrubHub for $650 million to Wonder, a fraction of the $7.3 billion purchase price.
The buyer Wonder, describes itself as a “new kind of food hall that is revolutionizing the food industry”, operating a collection of delivery-first restaurants featuring top chefs including Bobby Flay, Jose Andres, Nancy Silverton and Marcus Samuelsson, along with restaurants such as Tejas Barbeque and Di Fara Pizza. Customers can order any combination of these chefs and restaurants in one order. In 2023, Wonder also acquired meal kit business Blue Apron.
Forbes Daily: Join over 1 million Forbes Daily subscribers and get our best stories, exclusive reporting and essential analysis of the day’s news in your inbox every weekday.
Just Eat Takeaway Merger
With the deal set to be completed shortly, Wonder’s acquisition of Just Eat included $500 million of senior notes and $150 million cash, while Wonder also announced an additional $250 million in capital raised from new investors.
Grubhub will be integrated with Wonder to combine the selection of first-party and third-party restaurants, groceries and meal kits in a single app order. Additionally, all Wonder locations will be available on Grubhub for third-party delivery.
Just Eat Takeaway was formed in 2020 from a merger between the U.K.’s Just Eat and its Dutch rival Takeaway.com, shortly before the pandemic. Prosus had actually tried to hijack that merger in 2019 with a failed hostile $6.4 billion bid for Just Eat.
The combined company was for some time a member of London’s FTSE 100 index, with a valuation of nearly $19 billion, but is now only be listed on the Amsterdam stock market, where the company is headquartered. The company said the London delisting resulted from restarting a review into where its shares should be listed.
It cited the “administrative burden, complexity and costs associated with the disclosure and regulatory requirements of maintaining the LSE listing”, low liquidity and the trading volumes of its shares on the London market.
Prosus Backs Tech For Growth
Of the latest acquisition, Prosus chief executive Fabricio Bloisi said the deal paved the way for an “opportunity to create a European tech champion”, and said that Prosus “already has an extensive food delivery portfolio outside of Europe” as well as “a proven track record of profitable growth through investment”.
Prosus is owned by South African conglomerate Naspers, which has interests across a number of sectors including media, online classified ads, payments and education, as well as food delivery. For its part, Prosus owns 28% of Delivery Hero, 4% of Chinese food delivery company Meituan, and 25% of Indian online food company Swiggy.
Prosus claimed that its use of artificial intelligence “revolutionized operations” at another of its investments, Brazil’s iFood, and said that it wanted to follow the same growth path and would aim to use the same tactics at Just Eat Takeway.com.
Just Eat has “profitable cash-generative operations, with considerable growth potential” in the U.K., Germany and the Netherlands, Prosus said.