European food ordering firm Just Eat Takeaway.com said it was in advanced talks to buy Grubhub in an all-stock deal that, if completed, would create the world’s largest food delivery company by revenue.
- Just Eat Takeaway.com said it was in advanced talks to buy Grubhub in an all-stock deal
- The combined entity would become the largest food delivery service in the world
The merger would open up a tantalising new market to Just Eat Takeaway, which has a foothold across Europe, Canada and Latin America but none in America.
For Grubhub, the deal would relieve antitrust concerns raised by its talks with the Uber Eats division of ride-hailing firm Uber Technologies Inc.
Chicago-based Grubhub, which has a market cap of about $4.3 billion, was approached by Uber in May for an all-stock deal.
Uber, however, is now close to exiting the deal, CNBC reported on Wednesday.
Uber and Grubhub did not immediately respond to requests for comment.
Grubhub’s stock price fell 3% and Just Eat Takeaway shares closed more than 13% lower in Amsterdam.
A potential Uber-Grubhub merger had raised antitrust concerns, especially in major markets, including New York City, where Grubhub already controls a large share of restaurant deliveries.
Experts say consolidation is long overdue in the US restaurant delivery sector, where demand is surging, especially as many people stay home to combat the spread of the novel coronavirus.
Chris Sagers, who teaches at the Cleveland-Marshall College of Law, had predicted that Uber’s acquisition of Grubhub would be stopped by US antitrust enforcers.
But a deal between Grubhub and Just Eat Takeaway could win easy approval and was not even likely to be extensively reviewed, he said.
A Just Eat Takeaway merger with Grubhub would create a company with combined total revenues of more than 2.1 billion euros (approximately $2.38 billion).
That would eclipse the largest global food delivery company, China’s Meituan, which had 1.4 billion-euro business, according to a Just Eat presentation before it acquired Takeaway in a $7.8 billion deal in January.
Billionaire Chief Executive Jitse Groen founded Takeaway in 2000 while still a student and oversaw its growth through a series of acquisitions, including a 2018 deal to buy Delivery Hero’s operations in Germany
Groen still owns a 10.29% stake in Just Eat Takeaway.
The team at Platform Executive hope you have enjoyed the ‘Europe’s Just Eat Takeaway in advanced talks to buy US delivery firm Grubhub‘ article. Automatic translation from English to a growing list of languages via Google AI Cloud Translation. Initial reporting via our official content partners at Thomson Reuters. Reporting by Toby Sterling and Greg Roumeliotis. Additional reporting by Akanksha Rana in Bengaluru, Diane Bartz in Washington and Paul Sandle in London. Writing by Hilary Russ. Editing by Ramakrishnan M, Alistair Bell and Jonathan Oatis.