The deal will see the Amsterdam-based business acquire Just Eat for 731 pence per share—a 15% premium over its closing price on Friday—which values the company at more than £5 billion. Just Eat will own around 52.2% of the combined group. Mike Evans, chairman of Just Eat, will take on the same role in the combined company, while his counterpart, Adriaan Nühn, will assume the role of vice chairman.
If successful, the merger will bring together two businesses that processed a combined 360 million orders worth €7.3 billion in 2018 and generated revenues of more than €1 billion. The group will be headquartered in Amsterdam and listed on London's stock exchange. Shares in Just Eat closed up nearly 24% on Monday, while Takeaway.com saw a slight dip in its price per share.
The potential deal fits in with Takeaway.com's acquisition strategy, which has seen it buy a total of 19 companies since its launch in 2000. Last year, the business snapped up peer Delivery Hero's German operations for around €930 million, adding Germany to the growing list of countries in which it leads delivery service. Takeaway.com's possible acquisition of Just Eat will afford it a dominant position in the UK—the industry's largest market in Europe. The company has previously struggled in the region and, somewhat ironically, sold all of its British assets to Just Eat in 2016, per reports.
The London-based Just Eat is no stranger to takeover deals either. In 2016, it spent £66.1 million for Canadian company SkipTheDishes, and the following year it bought Hungryhouse for £200 million. However, Just Eat has come under fire in recent times due to slowed earning growth; Cat Rock Capital Management issued a statement in April calling for the company to merge with one of its peers.
Although it might be welcomed by shareholders, the deal is far from settled. One possible hurdle that the businesses might face would be approval from regulators. Earlier this month, the UK's competition authority put a halt to Amazon's multimillion-dollar investment in Deliveroo, Just Eat's main rival in the country. The European Commission also has no qualms in blocking transactions that could mean limited competition for consumers. With a 53% combined market share in Europe as of 2017, according to Statista, this a prime example of a deal that could face political scrutiny.
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