Just Eat agrees to combine with Takeaway.com in £8.2 billion deal
Just Eat has agreed a deal in principle to combine with Dutch rival Takeaway.com to form one of the world’s largest food delivery firms.
The joint group would be valued at about £8.2bn, and bring together businesses that process 360 million annual orders worth €7.3bn (£6.6bn). Just Eat is considered by analysts to have a market leading position in the UK food courier business.
However, it is involved in a battle with rivals Deliveroo and Uber Eats. Just Eat was founded by a group of five Danish entrepreneurs in 2000 and launched a year later. It employs 3,600 staff globally.
As well as the Just Eat brand in Europe, it trades as Skip The Dishes in Canada, iFood in Mexico and Brazil, and Menulog in Australia and New Zealand.
Just Eat is listed on the FTSE 100 stock exchange in London, where its shares opened up almost 25% on Monday, at 785p.
If the deal goes ahead, Just Eat shareholders will own just over half of the combined group, while Takeaway.com shareholders will take a 47.8% stake in the new company.
Just Eat chairman Mike Evans will maintain his existing role at the combined group, while Takeway.com chief executive, Jitse Groen, will also retain his title at the new, larger company, which will have its headquarters in Amsterdam.
The deal is being arranged as a takeover of Just Eat by Takeaway.com, and the Dutch firm has a deadline of 24 August to make a firm offer.
Earlier in the year, Just Eat was put under pressure by a shareholder to merge with a rival.
Activist shareholder Cat Rock, which owns 1.7% of the firm, has been pressing for a merger with Takeaway.com, in which it also has a stake.
In May, Amazon announced a £575m investment in rival Deliveroo, hitting Just Eat’s share price.
That investment has been blocked for now by the competition watchdog, pending an inquiry.In March, Just Eat said a fifth of the adult population in the UK used its services, while its delivery business in Canada – Skip The Dishes – was growing rapidly after the introduction of a bilingual service.
Peter Duffy, the interim chief executive, said four million new customers joined the business last year.
Despite this, US fund manager Cat Rock said it “believed that a merger with a well-run industry peer is a very attractive avenue for securing world-class leadership, delivery expertise, and a premium”.
The firm saw its group revenue grow by 43% in 2018 to £779.5m, while pre-tax profits were £101.7m, compared with a £76m loss in 2017.