Prosus, the Dutch investment group known for its strategic moves within the tech industry, has made headlines this week with its announcement to acquire Just Eat Takeaway, one of Europe's prominent food delivery platforms, for €4.1 billion. This decision marks a pivotal moment for both entities, as they seek to reshape the competitive dynamics of the food delivery sector.
The deal, which translates to €20.30 per share for Just Eat Takeaway shareholders, signifies not only financial stability for the food delivery giant but also confidence from Prosus, especially following the fluctuated fortunes of Just Eat’s stock. This acquisition is seen as particularly strategic, offering Just Eat much-needed capital to innovate and grow after years of declining share prices.
Just Eat's share price soared to as high as €110 during the pandemic, reflecting the surge in delivery services, but it has since faced significant setbacks, including reporting losses of €1.6 billion last year compared to €1.8 billion the previous year. The firm had also laid off over 2,000 employees as part of cost-cutting measures, including recent cuts related to their operations.
On the other hand, Prosus's offer includes substantial incentives for Just Eat’s management to remain involved after the acquisition. Jitse Groen, CEO of Just Eat, expressed optimism about the partnership, stating, "Just Eat Takeaway.com is now a faster-growing, more profitable, and predominantly European-based business. Prosus fully supports our strategic plans, and its extensive resources will help to accelerate our investments and growth across food, groceries, fintech, and other adjacencies."
This acquisition promises to create what Fabricio Bloisi, CEO of Prosus, describes as a "European tech champion." The deal aims to leverage Prosus's experience and resources to boost Just Eat's position within the European market, which, as noted by Bloisi, includes their existing holdings such as Delivery Hero.
Prosus already enjoys significant market penetration, and with this acquisition, they expect to create synergy between their previous business ventures and Just Eat's established platform. The consolidated revenue potential is noteworthy, predicted to be around €10 billion alongside gross transaction values of €53 billion. Bloisi highlighted, "We believe combining Prosus’s strong technical and investment capabilities with Just Eat Takeaway.com’s leading brand position will create significant value for our customers, drivers, partners, and shareholders."
Notably, Just Eat Takeaway has recently undergone strategic changes, including delisting from the London Stock Exchange, citing improved financial management and reduction of administrative burdens as key reasons. This decision mirrors the growing need for efficiency and rationalization within the industry.
The announcement of the acquisition has already impacted stock prices, with Just Eat's shares rising significantly, reflecting market optimism about the future of the company under Prosus's stewardship. Conversely, shares of Prosus experienced some fluctuations, indicating investor caution as they anticipate how this deal will play out.
For Just Eat, this acquisition stands as the latest chapter following their sale of GrubHub last year to Wonder Group for $650 million—a stark drop from the $7.3 billion they had invested just three years earlier. The decision to divest was based on their broader strategy to refocus resources and cut costs, aiming for profitability and operational excellence.
Looking forward, the integration of Just Eat with Prosus's extensive network and resources is expected to open new avenues for growth and innovation, especially with the potential for deploying advanced technologies. Prosus’s experience with iFood, their successful food delivery project in Brazil, could serve as valuable guidelines for enhancing Just Eat's operational capabilities.
The deal still awaits regulatory and shareholder approval, which will determine the future stability and direction of the combined entity. Both companies are optimistic about overcoming potential hurdles, as the acquisition is backed by both boards’ unanimous support.
This ambitious move reflects the underlying trends and challenges within the food delivery market as speed and efficiency remain top priorities for consumers and companies alike. Just Eat Takeaway's management is poised to lead the way as they navigate this new chapter under Prosus's guidance.
Lastly, as the dust settles from this significant acquisition, stakeholders from all sides are eagerly awaiting to see how these developments could reshape the competitive food delivery industry, not just within Europe but on the global stage.