|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||96.90 - 96.90|
|52 Week Range||42.60 - 98.00|
|Beta (5Y Monthly)||0.75|
|PE Ratio (TTM)||625.16|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
(Bloomberg) -- Isolation is old hat for Eric Jackson. Since he launched his technology-focused hedge fund in 2017, he has been running it from a home office.The pandemic requires little adjustment in how he works. But it does force investors everywhere to think about which companies will do better in a scarred global economy. In Jackson’s case, the crisis has given his key holdings a huge boost: Zoom Video Communications Inc. and German food app company Delivery Hero SE have lifted his long-short fund at EMJ Capital Ltd. to a 56% gain this year.Jackson tries to hunt down data on technology usage that will lead him to winners. On Feb. 3, more than a month before the virus was declared a pandemic, Jackson noticed a sudden spike in downloads of the Zoom app in China. He already owned the stock because he liked its video conferencing technology and its CEO. The China numbers persuaded him to double down.“They are a verb. You don’t see too many verbs in the tech space. When one comes along like Google, you would have been wise to plunk down an investment and stick with it and I think the same is going to be the case for Zoom,” he said. Zoom shares have more than doubled this year.Hedge funds were hit hard by client withdrawals and investment losses during the March market rout, with global hedge fund assets dropping below $3 trillion for the first time in six years. In Canada, only five of 61 hedge funds tracked by Venator Capital Management Ltd. posted gains in the first quarter of the year.Read more: Hedge Fund Stock Exposure Is the Highest in at Least Three YearsListening in Silicon ValleyJackson runs one long-short fund, which has about $61 million in assets and is up 131% since inception in October 2017, as of Tuesday’s close. It typically owns about 11 to 20 stocks and has a similar number of short positions. Options are part of the strategy: the fund held out-of-the-money put options against some indices that rose sharply in value during the sell-off of late February and March as investors sought to buy protection against further declines.On the long side, “I’m trying to find companies that I think have a good shot at doubling or tripling over the next two to three years and I typically want to hold them for that long,” he said. As is common in funds that focus on tech growth stocks, there can be high day-to-day volatility. In normal times, he travels regularly to San Francisco and Silicon Valley to meet with contacts he’s built over decades after working in the tech industry himself. From 2000 to 2004, he worked at Toronto-based VoiceGenie Technologies Inc., a voice-recognition firm acquired by Alcatel for an undisclosed sum in 2006.“If I start to hear the same name come up over and over again, that’s usually a good sign that the company is just on the cusp of something great,” Jackson said. “So I’m getting behind those companies early, sticking with them, not just sort of selling out quickly.”Twilio Inc. was his biggest winner in 2018 after hearing about the company through friends and contacts. Shares of the San Francisco-based software maker rose 278% in 2018 and climbed another 10% last year as quarterly results kept beating expectations.He replaced Twilio in his fund with Delivery Hero and HelloFresh SE, a seller of meal kits. Both have been big contributors to his fund’s surge this year.“I was into them from last year. But when the pandemic kind of began to emerge and they canceled the NBA season, that was really the first time I realized that this was going to be a be a much bigger deal than I expected at the beginning of the year,” said Jackson, a Brooklyn Nets fan.Internet DinosaursJackson is also betting that EBay Inc. makes a comeback after buying shares last quarter.“It lost the war to Amazon, yet they have a bunch of interesting catalysts that I think are going to play out this year.”With a new CEO on board, former Walmart Inc. e-commerce executive Jamie Iannone, the company could see some renewed revenue growth, Jackson said. Iannone started as head of the company last month.EBay recently sold ticket-resale site StubHub for $4.05 billion and is in the midst of evaluating offers for its classified ads business. Jackson, who has been an activist investor in Yahoo and Viacom, hopes EBay will use its cash for acquisitions.“There’s a turnaround story there that people aren’t paying attention to because it’s this boring dinosaur of a company.” He sees EBay’s share price rising to $100 over the next six to 18 months. EBay’s stock closed at $40.32 on Tuesday.Health TechPutting his “citizen hat” on, Jackson is pessimistic that the reopening of economies will go smoothly as bankruptcies hit small businesses and energy companies. But the pandemic will lead to big changes in health care and technology, he predicts.“I think there’s an opportunity for other devices to keep track of people’s health and connect to the hospitals so you don’t have to travel in and your doctors can have this remote relationship with you,” he said.He owns shares of DexCom Inc., which develops devices to monitor blood sugar levels in diabetic patients. Jackson’s son was diagnosed with Type 1 diabetes a few years ago and that’s how he came across the company. “They keep making these devices smaller and lighter, less obtrusive and less expensive so I think they are an interesting company to watch.”He also owns Livongo Health Inc., a U.S.-focused remote health monitoring company. The shares have gained 75% this year, while DexCom is up 67%.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But investors...
German online takeaway food company Delivery Hero reported a near doubling in first-quarter orders and revenue on Tuesday and predicted that the rise of ordering meals and groceries from home would persist after the coronavirus crisis. The Berlin-based company, which runs platforms for food delivery in 44 countries, said sales rose 92% to 515 million euros ($557 million). "Delivery Hero is evidently having a 'good crisis'," said Jefferies analysts Giles Thorne and Sebastian Patulea.
Latin America’s leading legacy food delivery company iFood and Delivery Hero-owned Domicilios.com are merging in a bid to take on the food startup Rappi on its home turf. The price of the transaction was undisclosed, but will result in iFood holding a 51% equity stake in the partnership, while Delivery Hero will hold the remaining 49%.
The lockdown of millions of people at home across the globe due to the coronavirus should have been the perfect recipe for success for the burgeoning online meal delivery market. While many restaurants have switched to offering takeaway, giving the online services a bump in members signing up, some of the world's biggest food chains using the apps, such as McDonald's <MCD.N> and Wagamama, have closed in the United Kingdom for the time being. Data from SimilarWeb, which tracks downloads and use of smartphone apps and websites across key European markets, highlights the scale of the slowdown across Europe as the pandemic spread and governments ordered people to stay at home.
Online food delivery demand has soared as more countries impose coronavirus lockdowns but, while there are problems ahead, the pandemic will bring longer-term benefits for the sector, UBS said on Friday.
Delivery Hero <DHER.DE>, one of the world's top online food delivery marketplaces, announced measures on Thursday to support restaurants that are trying to survive coronavirus lockdowns by ramping up deliveries to consumers stuck at home. Delivery Hero said it was speeding up the onboarding process for new partner restaurants, increasing the frequency of payments to its partners to improve their cashflow and offering free delivery for customers close to restaurants. "Many of these restaurants might have liquidity for one, two or three weeks of sales so they could go bankrupt very quickly," Delivery Hero Niklas Ostberg told Reuters.
(Bloomberg Opinion) -- The various levels of lockdown and quarantine across China haven’t proven a golden opportunity for the biggest food delivery and bookings company, a warning for on-demand service providers elsewhere as more of the world stays at home to avoid the coronavirus.Meituan Dianping says it will post a loss for the first quarter ending Tuesday following a decline in revenue. The Beijing-based company’s business consists of three main divisions — food delivery, restaurant and travel bookings, and other services such as car hailing, bike rental and groceries.Bookings, which account for around 23% of revenue, took the biggest hit. That was predictable. Consumers aren’t keen to take a seat at a restaurant or a night at a hotel amid a deadly disease outbreak, and widespread travel curbs meant moving around China wasn’t an option.Food was more of a surprise. Two months ago amid the Lunar New Year break, I theorized that such deliveries — at 56% of Meituan’s revenue — might bounce back quickly as customers opted to stay in rather than eat out. I was wrong.Thousands of vendors on Meituan’s platform were forced to close either voluntarily or by mandate, and thus couldn’t provide meals. Those who did stay open were often met with fear and complications on the demand side.Many customers had concerns not only over the safety of meals coming from restaurants, but the drivers who delivered them. Those still willing to order online were met with layers of challenges as local governments, neighborhoods and buildings exercised strict controls over who could come and go. There was no supply bottleneck for drivers; Meituan noted plenty of capacity on hand.Three weeks ago, Alibaba Group Holding Ltd. said that its own courier and food delivery services, Cainiao and ele.me, were back to full staffing. But the food business was still down because many restaurants remained closed.An upside has been grocery delivery. Meituan’s two services, self-operated and marketplace, have seen strong growth during the crisis, a trend that echoes what Alibaba experienced with its Freshippo service. In many cities, consumers either cannot or prefer not to step out to shop. They’re apparently less afraid of groceries brought to their door than fresh-cooked meals.Even as China returns to a certain level of normalcy, food delivery may struggle for another few months. Most companies are maintaining degrees of isolation, such as working from home or rotating shifts. Taking lunches to places of business is normally an important part of the consumption scenario. As investors start to ponder the outlook for Delivery Hero SE, Just Eat Takeaway, and GrubHub Inc., they’d do well to look at how their China peers have fared during the virus battle. Collectively, these companies get most of their revenue from Western markets that are now imposing lockdowns to battle the pandemic. They’re implementing contact-free and non-cash deliveries to make customers feel safe.That may not be enough. While it’s true that people still have to eat, China’s experience shows that this doesn’t mean consumers will necessarily order delivery or that restaurants can supply them.This column does not necessarily reflect the opinion of Bloomberg LP and its owners.Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Delivery Hero has switched to cash-less, non-contact for deliveries in areas it defines as "high risk" for the transmission of the SARS-CoV-2 virus to reduce personal contact between couriers and customers during the coronavirus pandemic. The company is also providing riders in "high risk" zones with hand sanitisers, masks and other safety materials -- "where and when it is locally and culturally accepted".
(Bloomberg) -- Just Eat Takeaway.com NV, the food delivery company formed out of a merger earlier this year, has started arbitration proceedings against shareholder and rival Delivery Hero SE.It said in a statement that Delivery Hero broke a relationship agreement when the company announced plans to purchase shares in Takeaway last month. Takeaway has initiated the arbitration with the International Chamber of Commerce, a business group with members in more than 100 countries, which also handles corporate disputes.In 2018, Takeaway agreed to buy Delivery Hero’s German operations for about 930 million euros ($1.03 billion) in cash and shares, giving the firm an approximately 18% stake in its Dutch rival. As part of the deal, Delivery Hero entered into a so-called standstill agreement, promising not to increase its exposure for four years, with some exceptions to prevent dilution.Delivery Hero said in April, after Takeaway won the bidding war for Just Eat, that it would enter into a forward share purchase to restore its exposure in Just Eat Takeaway.com to about 10.6%, following the dilution that had been caused by the merger.But during Takeaway’s negotiations for Just Eat last year, Delivery Hero caused controversy by selling about 3 million of its Takeaway shares, hurting the stock price and lowering the value of its bid.Takeaway Chief Executive Officer Jitse Groen called Delivery Hero’s plans to increase its stake “puzzling.”A spokesperson for Delivery Hero didn’t have an immediate comment.The ICC Court of Arbitration handles 800 to 1,000 cases annually, making it the largest party for international commercial dispute resolution.\--With assistance from Sarah Syed and Ellen Proper.To contact the reporter on this story: Amy Thomson in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Giles Turner at email@example.com, Nate LanxonFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Food delivery giant Just Eat Takeaway.com was forged by Dutch online service Takeaway's $7.8 billion (£6.01 billion) acquisition of British food deliverer Just Eat. The forward share purchase will restore the German-based company's exposure in Just Eat Takeaway.com to 10.6% after the dilution caused by the merger, Delivery Hero said.
Bird, the LA-founded e-scooter giant, has confirmed that it is acquiring European competitor Circ, the micromobility company founded by Lukasz Gadowski of Delivery Hero fame. At the time, Gadowski put on a brave face, telling TechCrunch that Circ needed to learn how to operate a micromobility service across many European markets simultaneously. “When we started this there was a focus on time to market, but now it is not about time to market but efficiency,” he told TechCrunch.
The new year isn't even a month old and the food delivery crunch is already taking big bites. Spain's Glovo has today announced it's exiting four markets -- which it says is part of a goal of pushing for profitability by 2021. On-demand food delivery apps may be great at filling the bellies of hungry consumers fast but startups in this space have yet to figure out how to deliver push-button convenience without haemorrhaging money at scale.
(Bloomberg) -- South Korean e-commerce giant Coupang Corp. is preparing for an initial public offering as soon as 2021, according to people with knowledge of the matter.The Seoul-based company, founded in 2010 by Chief Executive Officer Bom Kim and said to be valued at $9 billion in late 2018, has begun working on tax structuring among other changes as it eyes a public listing next year, said one of the people, who requested anonymity because the matter is private. A company representative declined to comment.Last month, Coupang -- whose investors include SoftBank Group Corp.’s Vision Fund, BlackRock Inc. and Sequoia Capital -- appointed Alberto Fornaro as chief financial officer to succeed Richard Song. Earlier in 2019, it hired Jay Jorgensen, a former Walmart Inc. executive, as general counsel and chief compliance officer.SoftBank’s shares were up as much as 3.8% in Tokyo in the wake of the news.In November 2018, the Vision Fund invested $2 billion in the company in a deal that valued Coupang at $9 billion, people familiar with the matter said at the time. That funding followed $1 billion from SoftBank itself in 2015, valuing the startup at about $5 billion.Korea’s e-commerce market is the fifth-largest in the world and on track to be the third-largest by 2021, behind only China and the U.S., according to Coupang.Coupang had more than $10 billion in gross merchandise value on its platform as of Dec. 31, according to a person familiar with the company. Sales increased more than 60% year over year in 2019, the person said.Kim, a Harvard University dropout, had mulled an IPO a few years ago, he told CNBC in December, but opted instead to expand the business with a nationwide fast delivery network. In spite of intense competition from EBay Inc.’s Gmarket and family-run conglomerates such as Shinsegae Inc. and Lotte, Coupang has successfully expanded its shopping and delivery services with SoftBank’s investment.Though still unprofitable, Coupang has been pushing a growth narrative when talking to investors and in the summer it launched Coupang Eats as an extension of its delivery services. When South Korea’s biggest food delivery app Woowa Brothers Corp. sold an 87% stake to Delivery Hero SE, it alluded to Coupang Eats as a strong challenger.“Assuming Coupang lists shares in the U.S., it might get a conservative valuation as a loss-making unicorn, owing to WeWork’s IPO failure,” said SK Securities analyst Yoo Seung-woo.(Updates with analyst comment and SoftBank share price)To contact the reporters on this story: Giles Turner in London at firstname.lastname@example.org;Gillian Tan in New York at email@example.com;Sohee Kim in Seoul at firstname.lastname@example.orgTo contact the editors responsible for this story: Alan Goldstein at email@example.com, Andrew Pollack, Vlad SavovFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
South Korean restaurant owners expressed concern on Monday over food delivery giant Delivery Hero's proposed $4 billion acquisition of its local rival, saying the move could undermine competition and lead to higher fees. Delivery Hero, the second-largest food delivery app operator in South Korea, said last month that it agreed to buy larger rival Woowa Brothers backed by Goldman Sachs in a deal subject to antitrust approval. The combination of the two giants would create an entity with a combined market share of nearly 99% in food delivery apps, according to data from mobile big data platform IGAWorks.
(Bloomberg) -- Amazon.com Inc.’s purchase of a minority stake in U.K. food startup Deliveroo faces a British probe in another sign of mounting antitrust scrutiny of American tech giants.The Competition and Markets Authority said Friday it’s opening an in-depth investigation of Amazon’s investment of about $500 million, saying it risked a “substantial lessening” of competition “in the supply of online food platforms in the U.K. and in the supply of online convenience groceries.”The regulator now has until June 11 to rule on the deal after the companies didn’t offer remedies to allay its earlier concerns over the tie-up.Many were surprised by the CMA’s initial decision to investigate the transaction because the agency doesn’t typically review minority acquisitions. Lawyers said scrutiny of the deal may be down to growing fears about monopolies in Big Tech that have been allowed to go unchecked in the past.Deals like Facebook Inc.’s 2014 acquisition of WhatsApp sailed through with relatively little antitrust oversight at the time, but are now raising questions among regulators who see large tech companies leverage user data from those acquisitions in other areas to boost their market power.“A homegrown U.K. business like Deliveroo should have broad access to investors and supporters,” an Amazon spokesman said in an emailed statement. He added the company believes the investment “will lead to more pro-consumer innovation by helping Deliveroo continue to build its world-class service and remain competitive in the restaurant food delivery space.”The in-depth probe comes as competition heats up in the global food delivery market.The likes of Uber Technologies Inc.’s Uber Eats platform are going up against a proliferation of apps for a share of the fast-growing sector, while other players are consolidating.Dutch groups Prosus NV and Takeaway.com NV have been vying to take over British food delivery firm Just Eat Plc, while Germany’s Delivery Hero SE in December said it would take control of South Korea’s biggest food delivery app, Woowa Brothers Corp.In an emailed statement, Deliveroo said it was “confident that we will persuade the CMA of the facts that this minority investment will add to competition, helping restaurants to grow their businesses, creating more work for riders, and increasing choice for customers.”(Updates with Amazon comment in sixth paragraph)\--With assistance from Aitor Ortiz, Diana Gomes and Jonathan Browning.To contact the reporters on this story: Eddie Spence in London at firstname.lastname@example.org;Natalia Drozdiak in Brussels at email@example.comTo contact the editors responsible for this story: Christopher Elser at firstname.lastname@example.org, Peter Chapman, Nate LanxonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Just Eat Plc chose a revised offer by Takeaway.com NV to merge and spurned a final all-cash bid by Prosus NV, which appears all but set to lose the drawn-out fight to claim ownership of the British food-delivery firm.The U.K. company on Friday said its board recommended Takeaway’s final offer because it would deliver greater value to Just Eat shareholders than Prosus’s final revised bid. Just Eat has also rejected Prosus’s previous bids.Takeaway said Thursday it increased its offer to 916 pence per share, with Just Eat holders to own 57.5% of the combined group. Just moments before, Amsterdam-listed Prosus 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.“Just Eat continues to believe that the combination with Takeaway.com is based on a compelling strategic rationale that allows shareholders to participate in the upside potential of the enlarged group,” Just Eat said in a statement, adding that it recommended shareholders take no action on the Prosus offer.In a statement Friday, Prosus said its cash offer remains open but that it doesn’t plan to buy Just Eat shares in support of the offer.“We have always stated that we would remain disciplined with respect to price on acquiring Just Eat,” Prosus Chief Executive Officer Bob van Dijk said.Takeaway shares have continued to drop in Friday trading, down around 2% to around 78.10 euros in the mid-afternoon. Prosus shares were up 0.8% to 66.29 euros a share.So far, a collection of investors have also been vocal in their support of Takeaway’s bid. Cat Rock Capital Management, which owns shares in both Takeaway and Just Eat, said Takeaway’s offer is a “win-win for both companies,” and urged Just Eat shareholders to “join us in accepting this final Takeaway.com offer at the earliest possible opportunity.”Aberdeen Standard Investments, a Just Eat shareholder, also said it welcomed Takeaway’s improved offer.“The combined business will be a global leader in the strongly growing online food delivery market and we want to retain exposure to its exciting long-term potential, rather than taking a cash offer for Just Eat and walking away,” said Andrew Millington, head of U.K. equities at Aberdeen.Read More: Takeaway.com Tipped as Winner in Just Eat Bid War: Street WrapShareholders have until Jan. 10 to make up their mind. Takeaway said it has received acceptances and commitments of around 41.09% of Just Eat’s shares and reduced its acceptance condition for the deal to a majority of 50% plus one Just Eat share.Next StepsProsus has argued that it has the resources to make the significant investments in Just Eat necessary for it to stay competitive, while Takeaway believes that it actually knows how to run a food delivery startup, rather than just own one.However, the two bids have been further complicated after shares of Takeaway on Thursday dropped as much as 10% after the final bids were announced, cutting the amount those backing the Takeaway deal would receive. Shares in Prosus rose just over 1%.“We have brought forward our best and final offer for Just Eat,” Takeaway CEO Jitse Groen said in a statement. “We believe it provides Just Eat shareholders with tremendous upside.”“Takeaway.com’s improved all-stock merger terms for Just Eat -- to be sweetened with 50% of the cash proceeds from its iFood stake sale -- is more likely to be accepted by the 50% threshold of shareholders by Jan. 10 (vs. 13.5% currently). The implied value of 916 pence a share tops Prosus’ raised cash offer.”Diana Gomes, BI consumer analystBrazil’s iFoodTakeaway also said it would now explore the exit of Just Eat’s 33% stake in Brazil-based iFood, in which Prosus also invested, adding it would return around 50% of the net proceeds to shareholders of the combined group.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.(Updates with Prosus reaction)\--With assistance from Lisa Pham.To contact the reporters on this story: Natalia Drozdiak in Brussels at email@example.com;David Hellier in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Giles Turner at email@example.com, Nate LanxonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Abu Dhabi’s sovereign wealth fund Mubadala is placing a bet on the growing demand for food delivery platforms with an investment in Spanish startup Glovo.Mubadala was the lead investor in Glovo’s 150 million euro ($167 million) funding round closed Wednesday, according to a statement, bringing its valuation to over $1 billion. Other backers in Barcelona-based Glovo included Drake Enterprises, Lakestar and Idinvest, all of which were already investors.This was the third round in which Glovo raised more than 100 million euros over the past 17 months, as it seeks to bolster its position in the booming food delivery sector by expanding into new markets and increasing its software development teams. Glovo operates in 26 countries.Investors are flocking to delivery companies, as consolidation unfolds across the globe. On Dec. 13, Delivery Hero SE acquired South Korea’s Woowa Brothers Corp for $4 billion, while rival Takeaway.com NV is in a bidding war with Naspers Ltd. spin-off Prosus NV for British delivery app Just Eat Plc.Over the past year, Glovo drew attention from rivals including Uber Technologies Inc. and Deliveroo. The Spanish startup has also been weighing the possibility of holding an initial public offering, people familiar with the matter have said.Like a number of its rivals, Glovo is not solely focused on food delivery, but is also open to other types of products and is rolling out so-called darkstores from which it services groceries and other products to clients. The company has seven in four cities and plans to open 100 by 2021.To contact the reporter on this story: Rodrigo Orihuela in Madrid at firstname.lastname@example.orgTo contact the editors responsible for this story: Giles Turner at email@example.com, Nate LanxonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Seoul and South Korea may well be the secret startup hub that (still) no one talks about. While often dwarfed by the scale and scope of the Chinese startup market next door, South Korea has proven over the last few years that it can — and will — enter the top-tier of startup hubs. Case in point: Baedal Minjok (typically shortened to Baemin), one of the country’s leading food delivery apps, announced an acquisition offer by Berlin-based Delivery Hero in a blockbuster $4 billion transaction late this week, representing potentially one of the largest exits yet for the Korean startup world.
SEOUL/FRANKFURT (Reuters) - Germany's Delivery Hero agreed a $4 billion deal to buy South Korea's top food delivery app owner Woowa Brothers, ratcheting up consolidation in the industry as it expands in Asia's fast-growing but crowded market. Woowa said it fell into the arms of its rival as "a survival strategy" in an intensely competitive market. For Delivery Hero, now worth over 11 billion euros ($12 billion) after listing at a value of 4.4 billion euros two and a half years ago, buying Woowa expands its presence in Asia as Europe becomes more competitive.
(Bloomberg Opinion) -- It’s the worst nightmare of supermarkets and food delivery firms alike: Amazon.com Inc. turbocharging its grocery business with a network of couriers who can have grub on your doorstep within an hour.So you can see why Britain’s competition regulator has decided to challenge the e-commerce giant’s planned investment in Deliveroo, the U.K. rival to UberEats. The Competition and Markets Authority needs to tread carefully, though, as denying the funds to Deliveroo might inadvertently make it less able to compete in the food delivery business. That would be an unfortunate outcome.Back in May, Deliveroo announced a $575 million funding round led by Amazon. On Wednesday, the CMA determined that the investment might hurt competition in U.K. food delivery. It has given the companies five days to offer remedies, and it will launch a deeper probe if they don’t.The CMA’s concerns are warranted. While Amazon shuttered its British restaurant delivery operations last year, it remains interested in the market. The Deliveroo investment is a way of staying in the game; the American company is no doubt interested in the British business’s tens of thousands of riders. The two are also rivals in grocery deliveries, so forging a closer alliance would discourage them from competing. That’s a risk for delivery rival Ocado Group Plc and supermarket chains such as J Sainsbury Plc and Tesco Plc.A lengthy CMA investigation might be a problem, though, because of Deliveroo’s pressing capital requirements. A probe probably wouldn’t complete until the second quarter of next year, according to Bloomberg Intelligence analyst Aitor Ortiz. By then Deliveroo will have waited a year to receive its investment. If previous form is a guide, it needs that money. In 2018 Deliveroo burned through almost 200 million pounds ($263 million) of cash. If it has been spending at a similar clip this year, it might be nearing the bottom of its pile.There are plenty of remedies that might be acceptable to the CMA: An assurance from Amazon that it won’t try to buy Deliveroo for five years; a pledge not to integrate delivery services; and Amazon refraining from taking a board seat. If such concessions remove Amazon’s rationale for the investment, then it should back out. At least that would give Deliveroo an earlier opportunity to find different funding.The CMA will have one eye on what happened recently in the German food delivery market, where Takeaway.com NV acquired the local businesses of Delivery Hero SE, giving it more than 90% market share. But it can afford a degree of lenience in this case. It could still block any merger, should that materialize. Delaying Deliveroo’s access to funds would probably hold the company back in its market scrap with UberEats and Just Eat Plc.Regulators have been poor at anticipating the market-cornering impact of deals in the past, most famously Facebook Inc.’s acquisition of Instagram and Google’s $3.2 billion purchase of DoubleClick. Scrutinizing Amazon is right and proper, and a commitment not to integrate Deliveroo’s courier network would be a fair condition. But unless a full merger is on the table, the CMA mustn’t overdo things.To contact the author of this story: Alex Webb at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Alex Webb is a Bloomberg Opinion columnist covering Europe's technology, media and communications industries. He previously covered Apple and other technology companies for Bloomberg News in San Francisco.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
German food delivery company Delivery Hero <DHER.DE> said it expects to grow its adjusted core earnings in the Middle East and North Africa while still investing in the region in 2020, and that Europe would break even for the full year. Chief Financial Officer Emmanuel Thomassin told investors at the Morgan Stanley Technology, Media and Telecoms conference on Thursday that the firm had not given guidance for 2020 because it was still finalising budgets and considering proposals. The company said last month it expected to reach adjusted EBITDA breakeven in Europe in the fourth quarter of 2019.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Prosus NV Chief Executive Officer Bob van Dijk is on to something big with his bid for Just Eat Plc, and he isn’t going to let it get away easily.The giant Naspers Ltd. spinoff officially filed its hostile offer for Just Eat on Monday, going up against both a unanimous rejection from Just Eat’s board, and a rival bid from Takeaway.com NV that was supposed to close by the end of the year.“In terms of opportunity, the food space is very, very, very large,” Van Dijk said in an interview prior to the bid. It’s “probably the largest opportunity I’ve run into in my lifetime.”Read more about the rival bids for Just Eat here.Just Eat would be a key piece in building out Prosus’s take out empire. Begun in 2013 with a $2 million investment in Brazil’s iFood, since 2016 it has invested about $2.8 billion in the sector. The company also has holdings in India’s Swiggy and Germany’s Delivery Hero SE, but it doesn’t want to stop there.An acquisition of Just Eat would result in a combined presence in more than 50 markets, and a number one position in 40 of those, according to Prosus. In Brazil, the deal would combine with Just Eat’s existing stake in iFood. Prosus is giving investors until Dec. 11 to accept the 710 pence per share deal.Prosus is keen to sell the idea that its food investment companies all get along rather than cannibalize each other. Swiggy CEO Sriharsha Majety said in an interview prior to Prosus’ bid for Just Eat that his team will sometimes hold calls with other Prosus companies if they think they solved a similar problem in a more effective way. Similarly, Fabricio Bloisi, chief executive of Movile, which owns iFood, said he was inspired by how Swiggy built kitchens where restaurants cook meals exclusively for delivery orders.Last year, Prosus sent a task force of as many as 40 people to Brazil to help iFood develop a new artificial-intelligence strategy, helping the company reduce prices by predicting where and when people will want a certain dish.If it succeeds in acquiring Just Eat, Prosus plans to make significant investments in product innovation, technology and delivery capabilities to ensure the delivery company maintains its market position.“Just Eat’s under investment in the sector has lead to them losing market share, and having its share price under pressure,” Van Dijk said in a conference call on Monday. “We have been speaking to shareholders on how the business is doing and what the long-term potential is - and the investment required to take it there.”Read about Just Eat’s latest earnings report here.Takeaway.com’s selling point is that it actually knows how to run a food delivery startup, rather than just owning one. Both the management of Just Eat and Takeaway.com are betting that their combined experience in turning a profit -- in an industry scattered with loss-making startups -- will help convince shareholders that it can fight off sizable rival startups that may also join forces.The fight over Just Eat comes amid an increasingly competitive landscape around the world for services that pick up or prepare meals and deliver them to customers’ front doors. Increased smartphone adoption, as well as innovations in mapping, logistics and other technologies have driven down the costs of online food delivery and helped catapult growth in the sector in recent years.Still, margins can be tight and startups are going up against tech giants including Uber Technologies Inc. to strike deals with the most popular restaurants and keep customers happy.While some Just Eat investors have complained about both the 710 pence-per-share cash offer from Prosus and Takeaway’s all-stock offer, currently valued at about 627 pence, neither company has indicated that they’d raise the bid.For now, it’s down to the shareholders to make up their mind. Aberdeen Standard Investments, which holds about 5% of Just Eat, said that Prosus needs to increase its offer by 20%. The investor also wanted Takeaway to increase its bid. Eminence Capital, which holds about 4%, in September said Takeaway’s bid undervalued Just Eat and that it planned to vote against that deal.“I can fully understand that the current cash values of both our and the competing offer aren’t particularly appealing to the Just Eat shareholders, and seem to be quite far removed from the fair value of Just Eat,” Jitse Groen, CEO of Takeaway.com, said in a statement posted on the company’s website on Monday. “We do however believe that the agreed merger ratio between Just Eat and Takeaway.com is appropriate.”(Updated to reflect time of interview.)\--With assistance from Loni Prinsloo.To contact the reporter on this story: Natalia Drozdiak in Brussels at firstname.lastname@example.orgTo contact the editors responsible for this story: Giles Turner at email@example.com, Amy ThomsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.