FILE PHOTO: Signage for Just Eat is seen on the window of a restaurant in London, Britain
FILE PHOTO: Signage for Just Eat is seen on the window of a restaurant in London, Britain

Prosus, Takeaway place final offers in Just Eat food battle

By Natalia Drozdiak and David Hellier Time of article published Dec 20, 2019

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INTERNATIONAL - Takeaway.com raised its bid for Just Eat Plc just minutes after Prosus NV upped its offer, in last-ditch attempts of an ongoing battle to claim ownership of the U.K. food-delivery firm.

The Dutch group said Thursday it increased its offer to 916 pence per share, with Just Eat holders to own 57.5% of the combined group. Amsterdam-listed Prosus also increased its cash offer, to 800 pence per share, valuing the company at about 5.5 billion pounds ($7.2 billion). Both companies said these were their final offers and they would not be increased.

Shares of Takeaway dropped as much as 10% on the news. Shares in Prosus rose just over 1%.

“We have brought forward our best and final offer for Just Eat,” Takeaway Chief Executive Officer Jitse Groen said in a statement. “We believe it provides Just Eat shareholders with tremendous upside.”

Just Eat rejected Prosus’s previous bids -- the last at 740 pence a share -- saying the offers undervalued the company. The board continued to recommend an all-stock bid by Dutch group Takeaway.com NV, even as the value of its offer has fluctuated in light of Takeaway’s share price. A Takeaway spokesman declined to comment on Prosus’ increased bid.

Just Eat is currently reviewing both final offers and and advises shareholders to take no action at this time, the company said in a statement.

A representative for Prosus didn’t immediately respond to a request for comment.

Brazil’s iFood

Takeaway said it has received acceptances and commitments of around 41.09% of Just Eat’s shares. It said Thursday it reduced its acceptance condition for the deal to a simple majority of 50% plus one Just Eat share.

Takeaway also said it would now explore the exit of Just Eat’s 33% stake in Brazil-based iFood, in which Prosus are also investors, adding it would return around 50% of the net proceeds to shareholders of the combined group.

Following the announcements, Cat Rock Capital Management, which owns shares in both Takeaway and Just Eat, said Takeaway’s offer is “highly compelling” and urged Just Eat shareholders to “join us in accepting this final Takeaway.com offer at the earliest possible opportunity.” It has previously said a Prosus cash bid would need to be 925 pence to compete with the merger.

The companies are vying for Just Eat as competition heats up in the global food delivery market. Giants like Uber Technologies Inc.’s Uber Eats platform are going up against a proliferation of apps for a share of the fast-growing sector. Other players are consolidating, such as Germany’s Delivery Hero SE, which last week said it would take control of South Korea’s biggest food delivery app, Woowa Brothers Corp., at a $4 billion valuation.

Prosus, which like Takeaway is giving shareholders until Jan. 10 to accept its final offer, says it has the resources to make the significant investments in Just Eat necessary for it to stay competitive, while Takeaway argues that it actually knows how to run a food delivery startup, rather than just own one.

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