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Just Eat Takeaway wants to pay the purchase price entirely in own shares and accepts a premium of 27 percent on the latest closing price of GrubHub. The companies agreed on $ 75.15 per share, as announced after the US exchange closed Thursday night. This means that GrubHub will be valued at approximately $ 7.3 billion (€ 6.4 billion) at the time of the takeover.
According to the company, the merger will create the largest food delivery group outside of China. The transaction is expected to close in the first quarter of 2021.
Investors reacted to the planned takeover with mixed feelings.
The GrubHub share reacted in the preliminary trading on Thursday with an increase of 7 percent recently, but at $ 63.44 it was well below the offered $ 75.15.
One reason could be the planned payment in shares of Just Eat Takeaway. Many investors prefer to take over cash.
Analyst Hubert Jeaneau from the Swiss grobank UBS also referred to the fierce competition in the food delivery market. However, the US market in particular also offers plenty of opportunities. Just Eat Takeaway’s shareholders also seem to see positives and negatives. The stock price fluctuated between gains and losses on Thursday. Recently, the papers fell by around half a percent.
According to media reports, the competitor Uber had already initiated takeover talks with GrubHub in February. Because: The travel agent wants to expand its delivery offer Uber Eats. Food delivery business is booming, particularly in the Corona crisis. A merger of GrubHub and Uber Eats could have failed due to competition concerns, however, because both are primarily active in the US market. This problem should not exist now, since Just Eat Takeaway is not represented there at all.
After the deal was announced, Uber said the industry needed consolidation. “It doesn’t mean that we’re interested in every deal, at every price, with every player.” According to previous media reports, Uber offered $ 68 per GrubHub share.
According to information from the “Financial Times”, Uber had already tried to take over the GrubHub rival DoorDash last year, but flashed off. Even after GrubHub swallowed several competitors like Eat24 or Foodler, the company is still smaller than DoorDash in the US market.
Just Eat Takeaway itself was only created in the spring, also through a merger. The Dutch company Takeaway took over the British competitor Just Eat.
The Just Eat Takeaway share, on the other hand, loses 12.82 percent to £ 76.82 in London stock exchange trading.
Deutsche Bank considers counter bid for GrubHub unlikely
Deutsche Bank believes a counter bid for the US food delivery service GrubHub is unlikely given the proposed merger with Just Eat Takeaway.com. The US transport service provider Uber, who was also interested in GrubHub, would hardly be able to come back with a hostile offer and the German competitor Delivery Hero probably had no great interest in expanding into the very competitive US market, wrote analyst Kunal Madhukar in a study available on Thursday. He continues to rate GrubHub with “Hold”.
With its focus on profitability, GrGrubHub could also continue to lose market share. Now that the modalities of the acquisition by the British-Dutch company are known, the share price of GrubHub should from now on be determined more by the business development of a combined group of companies than by GrubHub’s own fundamental data.
/ hbr / DP / he
AMSTERDAM / CHICAGO (dpa-AFX)
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