Grubhub merges with European delivery company Just Eat Takeaway.com

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Grubhub plans to merge with European food delivery company Just Eat Takeaway.com, the companies announced on Wednesday.The agreement gives the Grubhub shares an implied value of $ 75.15, which implies a total equity value of $ 7.3 billion on a fully diluted basis. Grubhub shares climbed more than 7% during trading hours.

The merger, which would combine two of the best food delivery services in the United States and Europe, comes after the failure of Grubhub’s discussions with Uber amid concerns over an antitrust review. Although the two sides agreed on a price report, the companies remained concerned about the likely antitrust pressures and could not reach an agreement on how Uber would support Grubhub throughout the regulatory process, reported earlier Wednesday David Faber from CNBC. Uber stocks fell slightly after the hours following the announcement.

Uber offered 1,925 shares for each Grubhub share, valuing Grubhub at a volume-weighted average price of around $ 70 per share and a Wednesday closing value of $ 67.04, according to people familiar with the subject. Just Eat Takeaway offered 0.67 shares for each Grubhub share, an implied value of $ 75.15 for each Grubhub share based on the closing price on June 9 at € 98.60 Just Eat Takeaway. However, Just Eat Takeaway shares fell more than 10% on Wednesday’s news, bringing the offer down to around $ 65.17 per Grubhub share.

Just Eat has offered a small bonus where Grubhub is currently negotiating, a person familiar with the matter told CNBC before the deal was announced. At the close of the market on Wednesday, Grubhub’s shares were trading at around $ 59 per share, which gave it a market capitalization of $ 5.4 billion.

“Like carpooling, the food delivery industry will need to be consolidated in order to reach its full potential for consumers and restaurants,” an Uber spokesperson said in a statement. “That doesn’t mean that we’re interested in making a deal, at any cost, with any player. ”

Grubhub’s deal with Just Eat is unlikely to garner as much regulatory attention as its possible combination with Uber. The proposed Uber-Grubhub deal would have combined two of the three largest food delivery companies in the United States.

The companies said they expect the deal to close in the first quarter of 2021. Grubhub CEO Matt Maloney will join Just Eat’s board of directors and lead the combined operations in North America . According to the press release, two directors of Grubhub will join the Just Eat supervisory board.

The British competition authority has just given the green light in April for the British company Just Eat and the Dutch company Takeaway to join forces. At the time, the British Competition and Markets Authority said it was unlikely that Takeaway could have re-entered the British market significantly without the merger.

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