Grubhub to Be Acquired by European Delivery Company Just Eat Takeaway
The online restaurant delivery platform Grubhub has found a buyer—but it’s not Uber, which had been in talks as recently as last month to add the Chicago-based company to its Uber Eats service. Instead, Grubhub has landed a European suitor: the Amsterdam-based Just Eat Takeaway—that is, assuming everything plays out as planned.
Grubhub was once America’s largest delivery platform before being passed by DoorDash last year. Those sinking fortunes were compounded by government inquiries into the company's business practices, especially in New York City, which has been one of Grubhub's remaining strongholds (where it also operates as Seamless). The resulting damage to the company’s stock value and reputation made Grubhub ripe for acquisition, and it had reportedly been actively seeking a buyer.
Just Eat Takeaway was, itself, formed earlier this year out of a merger between the British brand Just Eat and the Dutch brand Takeaway.com. And if that newfound European giant is looking to quickly enter the U.S. market, acquiring Grubhub makes plenty of sense. Unlike Uber Eats, which handles actual delivery through its team of drivers, Grubhub has always focused on taking orders and leaving actual delivery up to the restaurants. Just Eat Takeaway follows a similar model meaning the two companies’ platforms are already compatible.
Jitse Groen, the chief executive of Just Eat Takeaway, certainly thinks it’s a good match. “I am excited that we can create the world’s largest food delivery business outside China,” the billionaire businessman said in a statement yesterday.
However, whether his company’s shareholders are as excited is yet to be seen. While shares in Grubhub jumped after the news, Just Eat Takeaway’s stock crashed about 13 percent following the announcement of the purportedly $7.3 billion all-stock acquisition plan. Reuters pointed to this disparity as proof that the marriage could still face resistance. Additionally, the Wall Street Journal suggests that an international all-stock deal can also prove complicated. So the merger still has plenty of hurdles ahead.
But Uber, it seems, isn’t going to try to stop the happy couple. “Like ridesharing, the food delivery industry will need consolidation in order to reach its full potential for consumers and restaurants,” Uber said in a statement. “That doesn't mean we are interested in doing any deal, at any price, with any player.” Ouch. Sounds like someone placed an order for serious beef.