|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||106.70 - 106.70|
|52 Week Range||67.50 - 111.02|
|Beta (5Y Monthly)||0.66|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
Shares of restaurant delivery marketplace Grubhub (NYSE: GRUB) jumped 44% in the first six months of the year, according to data from S&P Global Market Intelligence. A buyout offer from Uber (NYSE: UBER) and a subsequent agreement to sell itself to Just Eat Takeaway, the European food delivery giant, was the main reason for the surge. Grubhub limped into 2020 losing market share to rivals like DoorDash and Uber Eats.
(Bloomberg) -- Neither Uber Technologies Inc. nor Postmates Inc. are profitable. They’re hoping that a combination of the two businesses will somehow get them there.Uber said Monday it will spend $2.65 billion for the San Francisco-based food delivery company Postmates. The all-stock transaction is a bid to accelerate a path to profitability set by Uber Chief Executive Officer Dara Khosrowshahi and deliver growth rates once typical of Uber’s ride-hailing operation. Both aspects of that strategy rely on food delivery, which has gotten a boost from the coronavirus pandemic.The deal is a relatively modest outcome for Postmates, a pioneer of the gig economy that was outmaneuvered by deep-pocketed competitors. The privately held company had been valued at $2.4 billion in an investment last year, a person with knowledge of the matter said at the time.For Uber, the purchase comes at a reasonable price and could help lead to a rational—and perhaps someday, profitable—market, said Benjamin Black, an analyst at Evercore ISI. “You had four players who were very aggressive on price and were essentially giving away food for free,” said Black. “Rational pricing will start to kick in after consolidation.”Uber estimates that it will issue about 84 million shares of common stock for 100% of the fully diluted equity of Postmates, the company said in a statement Monday. Shares of Uber rose about 5% during trading Monday.Early this year, Uber was expecting to turn its first quarterly profit by the end of 2020. The virus forced a swift reassessment of that plan. Uber revised the estimate in May targeting a quarterly profit in 2021.Since the start of the pandemic, Uber has cut more than a quarter of its staff and exited or pared back some businesses, such as electric bikes and financial services, so it could focus on core areas: ride-hailing and food delivery. Growth in Uber’s core rides business was slowing even before the pandemic drove a first ever decline in bookings in the first quarter. Global rides plummeted 70%, Khosrowshahi said in June.Uber Eats has been a bright spot for the company as stay-at-home orders and restaurant closures have prompted more customers to order in. Food-delivery bookings more than doubled for Uber in the second quarter and rose about 67% for Postmates, Khosrowshahi said in the statement Monday.The company sees advantages from the Postmates deal beyond meal delivery. Postmates was a pioneer in so-called delivery-as-a-service, complementing Uber’s efforts in shuttling groceries, essentials and other goods, the company said. Restaurants and other retailers will benefit from tools and technology to connect with a bigger customer base, according to the statement.“Platforms like ours can power much more than just food delivery—they can be a hugely important part of local commerce and communities, all the more important during crises like Covid-19,” Khosrowshahi said.Postmates wasn’t Uber’s first choice. A proposed acquisition of Grubhub fell through last month when European rival Just Eat Takeaway.com NV bought it instead for $7.3 billion. Uber’s bid for Grubhub, one of the larger players in the U.S. food delivery market, was likely to have raised antitrust concerns, according to industry analysts. The two together would have controlled more than half the U.S. market.An acquisition of Postmates is less likely to raise regulatory scrutiny because it wouldn’t change the market as much. Postmates, a distant fourth, would give Uber a firm lead over Grubhub, but the combined company would still trail SoftBank-backed DoorDash Inc., the nationwide leader. Postmates would strengthen Uber’s position in Los Angeles and the American Southwest, two markets where the brand is strongest.Still, the deal has drawn some criticism. “Uber and Postmates’s business model is built on the exploitation of restaurants, workers, and consumers,” said Sarah Miller, executive director of the anti-monopoly group American Economic Liberties Project. “The Federal Trade Commission should refuse to rubber stamp this power grab.”Uber executives have been vocal for months about wanting to drive consolidation in the food delivery market. JPMorgan Chase & Co. was the financial adviser to Postmates, and Latham & Watkins LLP was its legal counsel. Uber’s legal counsel was Wachtell, Lipton, Rosen & Katz.In addition to competitive threats, the industry faces regulatory risks relating to worker classification. Uber and Postmates sued California last year, alleging a state law that took effect this year designed to give gig workers unemployment protections is unconstitutional.The acquisition of Postmates is expected to close in the first quarter of 2021, pending regulatory approval, Uber said. Pierre-Dimitri Gore-Coty, the head of Uber’s food-delivery business, is expected to remain in that role, a person with knowledge of the plan said Sunday night. Under their agreement, Postmates co-founder Bastian Lehmann and his team will stay on to manage the Postmates service, said another person, both of whom asked not to be identified discussing a private deal.In its statement, Uber said it plans to keep the Postmates app running separately, supported by a more efficient, combined merchant and delivery network.(Updates with profit context in the sixth paragraph.)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.
“We believe food delivery consolidation helps accelerate Uber’s pathway to profitability during 2021,” one analyst writes.
(Bloomberg) -- Uber Technologies Inc. agreed to buy Postmates Inc. for $2.65 billion to expand in food delivery after the coronavirus pandemic cratered demand for ride-hailing, its main business, and an earlier attempt to acquire Grubhub foundered.The all-stock deal is a modest outcome for Postmates, once a pioneer of the gig economy that was outmaneuvered by deep-pocketed competitors. It had been valued at $2.4 billion in an investment last year, a person with knowledge of the matter said at the time.Uber estimates that it will issue about 84 million shares of common stock for 100% of the fully diluted equity of Postmates, the company said in a statement announcing the deal Monday. Shares of Uber rose 5.7% at 10:02 a.m. in New York Monday.“Postmates is highly complementary to Uber Eats, with differentiated geographic focus areas and customer demographics, and Postmates’ strong relationships with small- and medium-sized restaurants, particularly local favorites that draw customers to the Postmates brand,” Uber said in the statement.Pierre-Dimitri Gore-Coty, the head of Uber’s food-delivery business, is expected to oversee the combined operation, a person with knowledge of the plan said Sunday night. Under their agreement, Postmates co-founder Bastian Lehmann and his team will stay on to manage the Postmates service, said another person, both of whom asked not to be identified discussing a private deal.In its statement, Uber said it plans to keep the Postmates app running separately, supported by a more efficient, combined merchant and delivery network.Since the start of the pandemic, Uber has cut more than a quarter of its staff and exited or pared back some businesses, such as electric bikes and financial services, so it could focus on core areas: ride-hailing and food delivery. Global rides plummeted 70%, Chief Executive Officer Dara Khosrowshahi said in June. Uber Eats has been a bright spot for the company as stay-at-home orders and restaurant closures have prompted more customers to order in.Uber sees advantages of combining with Postmates beyond just meal delivery. Postmates has also been an early pioneer in delivery-as-a-service, complementing Uber’s efforts in shuttling groceries, essentials and other goods, the company said. Restaurants and merchants will benefit from tools and technology to connect with a bigger consumer base, according to the statement.“Platforms like ours can power much more than just food delivery—they can be a hugely important part of local commerce and communities, all the more important during crises like Covid-19,” Khosrowshahi said in the statement. He noted that Uber Eats bookings in the second quarter are up more than 100% from a year earlier.Uber’s proposed acquisition of Grubhub fell through last month when European rival Just Eat Takeaway.com NV bought it instead for $7.3 billion. Uber’s bid for Grubhub, one of the larger players in the U.S. food delivery market, was likely to have raised antitrust concerns, according to industry analysts. The two together would have controlled more than half the U.S. market.An acquisition of Postmates is less likely to raise regulatory scrutiny because it wouldn’t change much in the competitive environment. Postmates, a distant fourth, would give Uber a firm lead over Grubhub, but the combined company would still trail SoftBank-backed DoorDash Inc., the nationwide leader. Postmates would strengthen Uber’s position in Los Angeles and the American Southwest, two markets where the brand is strongest.Uber executives have been vocal for months about wanting to drive consolidation in the food delivery market, though. Postmates and Uber have allied before. The two companies sued California last year, alleging a state law that took effect this year designed to give gig workers unemployment protections is unconstitutional.The transaction is expected to close in the first quarter of 2021, pending regulatory approval, Uber said.(Updates shares in third paragraph.)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.
(Bloomberg) -- Uber Technologies Inc. has agreed to acquire Postmates Inc. in a $2.65 billion all-stock takeover expected to be announced as soon as Monday morning in the U.S., according to people familiar with the matter.Uber Eats head Pierre-Dimitri Gore-Coty is expected to continue to run Uber’s combined delivery business, according to a person who asked not to be identified discussing a private deal. Under their agreement, Postmates Chief Executive Officer Bastian Lehmann and his team will stay on to manage Postmates as a separate service, another person said.The takeover would help Uber gain ground against privately-held DoorDash Inc., the current market leader in U.S. food delivery. While Postmates hasn’t kept pace with DoorDash, it maintains a strong position in Los Angeles and the American Southwest, both of which could be valuable to Uber Eats.Representatives for Uber and Postmates declined to comment.Read more: Uber, Posting First-Ever Decline in Rides, Says Worst Is OverUber and Postmates had held discussions on and off for about four years but the talks accelerated about a week ago after Uber approached the latter firm, one of the people said. The move for Postmates comes on the heels of Uber’s failed bid to acquire publicly traded GrubHub Inc., which was scooped up by Europe’s Just Eat Takeaway.com NV for $7.3 billion. Uber’s board of directors has approved the deal, a person said, though the plans could still be subject to change.Uber closed at $30.68 on Friday, after it had gone up more than 4% on initial reports of its bid for Postmates.Founded in 2011, Postmates was one of the first to let customers in the U.S. order meal delivery using a mobile app. However, competition has intensified in recent years and Postmates has fallen to a distant fourth. The company said in February 2019 that it had filed paperwork confidentially for an initial public offering but never went public. It raised private capital last year in a deal that valued the business at $2.4 billion.(Updates with Lehmann’s new role from the second paragraph)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.
Are there any reasons to buy this food delivery stock ahead of its merger with Just Eat Takeaway next year?
(Bloomberg) -- As deal activity falls across the world, a select group of acquisitive companies is still finding a way to get transactions done by taking advantage of surging stock prices.European companies have paid with their own shares for a series of high-profile transactions in 2020, including a bid by Just Eat Takeaway.com NV to enter the U.S. and create one of the world’s largest meal delivery companies. The volume of acquisitions by European buyers involving at least partial stock payment has jumped 83% through Tuesday to $37 billion, according to data compiled by Bloomberg.That’s helped keep deals flowing at a time when overall M&A in the region has fallen to the lowest level in a decade. The two largest takeovers of U.S. companies this year were also all-stock transactions. The payment method has proven an attractive option for companies reluctant to take on more debt at a time of economic uncertainty.“Some of the large technology or health care companies are looking at their rich stock valuations and using that as a currency to pursue growth,” Alison Harding-Jones, head of mergers and acquisitions for Europe, the Middle East and Africa at Citigroup Inc., said in an interview. “I would expect to see more of those deals.”Just Eat Takeaway shares have gained 14% in Amsterdam trading this year, bucking the 13% decline in the benchmark STOXX Europe 600 Index over the same period. The rise has given Just Eat Takeaway a market value of about $15.7 billion and brought it more financial power to outbid Uber Technologies Inc. with its $7.3 billion offer for Grubhub Inc. in the U.S.Valuation BridgeOther companies are seeing stock-for-stock acquisitions as a way of conserving cash and getting around the lack of bank financing.“There is still some uncertainty in the market,” Pier Luigi Colizzi, head of EMEA M&A at Barclays Plc, said in an interview. “Corporates tend to be shy to re-leverage after a crisis, so they’ll favor stock deals in the short term.”So far in 2020, deals with a stock payment element account for 12% of the value of all transactions announced by a European acquirer, compared with 5.5% during the same period last year, Bloomberg-compiled data show.Notable examples include French payment processor Worldline SA’s proposed $8.6 billion purchase of rival Ingenico Group SA, which offered the target’s investors a mix of cash and shares. Intesa Sanpaolo SpA offered all stock in its unsolicited bid for smaller Italian lender Unione di Banche Italiane SpA, a deal valued at about $5 billion when it was announced in February.“Stock deals work well to bridge valuation gaps in a volatile environment and also allow companies to protect their balance sheets,” said Robin Rousseau, head of EMEA M&A at Deutsche Bank AG.The trend of all-stock deals has also started to spread. National Commercial Bank, the largest Saudi lender by assets, last week proposed to pay as much as $15.6 billion in stock to acquire rival Samba Financial Group in what could become the world’s biggest banking takeover this year.While such deals aren’t on the rise in the U.S., the payment method helped this year’s biggest transactions get done. Aon Plc is paying in shares for its planned $30 billion purchase of rival insurance brokerage Willis Towers Watson Plc, which ranks as the largest U.S. takeover of 2020. Morgan Stanley’s proposed $13 billion acquisition of E*Trade Financial Corp. is also being funded with stock.“In uncertain times, stock deals can allow targets to participate in the upside of a combination -- including synergies -- while helping to bridge potential valuation gaps and manage debt levels,” said Dwayne Lysaght, co-head of EMEA M&A at JPMorgan Chase & Co. “As a result, they may also require less of a premium.”The Covid-19 lockdowns have pushed companies across sectors like travel and retail to the brink, with many turning to state aid or embarking on heavy cost-cutting programs. Prolonged business disruptions will force many mid-sized companies to seek strategic measures to survive, according to Citigroup’s Harding-Jones.A lot of companies valued at $1 billion to $5 billion are realizing they need to build scale, which should drive stock-for-stock deals in the coming months, she said.“It’s been a revelation that execution of M&A has continued, albeit at a slower pace,” Harding-Jones said. “What this crisis has taught us is that you can always find ways to get deals done.”(Updates with U.S. deals from third paragraph)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.
(Bloomberg) -- E-commerce group Prosus NV is in talks to increase its stake in iFood, Latin America’s biggest food delivery startup, amid a wave of consolidation in the industry, people with knowledge of the matter said.The Amsterdam-listed company has approached Just Eat Takeaway.com NV about buying part or all of its 33% holding in iFood, the people said, asking not to be identified because the information is private. Just Eat’s stake in the Brazilian company could fetch about $750 million to $1 billion in a sale, according to Bloomberg Intelligence analyst John Davies.Prosus, which is controlled by South African media and internet group Naspers Ltd., already has about a 55% interest in iFood, according to the investor’s 2019 annual report.“We love that business, and it’s run by a great team,” Prosus Chief Executive Officer Bob van Dijk said in an interview this week. “Just Eat Takeaway.com has said that they want to sell their shares, and obviously at the right price, we will certainly consider increasing our stake.”A representative for Prosus declined to comment further. A spokesperson for Just Eat Takeaway declined to comment, while a representative for iFood didn’t immediately respond to a request for comment outside regular business hours in Brazil. There’s no certainty the negotiations will lead to a transaction, and other suitors could emerge for the iFood stake, the people said.Food delivery deals have been heating up, with takeover battles emerging in recent months for Britain’s Just Eat Plc and Grubhub Inc. in the U.S. It’s also been one of the few sectors to benefit from the coronavirus pandemic, as customers stuck at home have turned to smartphone apps to order food from restaurants banned from offering table service.Just Eat Takeaway has pledged to explore exiting its iFood stake and said it would return about half the net proceeds to its shareholders. The group was formed earlier this year from Takeaway.com NV’s acquisition of Just Eat.Prosus also owns a stake in Indian delivery startup Swiggy and is the biggest shareholder of Germany’s Delivery Hero SE.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.
(Bloomberg) -- Prosus NV is hoping EBay Inc. classifieds won’t be the auction that got away.Having lost an $8 billion battle to buy Just Eat Plc to Takeaway.com NV in January, the e-commerce group is the party to beat in a hotly-contested auction process for the EBay business, according to people familiar with the matter.By pursuing the EBay unit, potentially valued at as much as $10 billion, Prosus is looking to seal its biggest purchase since spinning off from South African technology giant Naspers Ltd. last year. Prosus holds assets including a stake in Chinese Internet giant Tencent Holdings Ltd., as well as businesses from Brazil to Germany in industries such as online food delivery and classified advertising.Naspers opted to separate Prosus -- in which it retains a majority holding -- in the hopes shareholders would assign more value to its investments around the world. While the listing in Amsterdam was a chance for Prosus to begin an aggressive acquisition spree, a big deal has yet to materialize.It also missed an opportunity to expand in the U.S. after the combined Just Eat Takeaway.com NV agreed to acquire Grubhub Inc. for $7.3 billion in June.With about $7 billion in cash and ample liquidity from a long-list of lenders, Prosus has the financial power to pursue large mergers and acquisitions and is on the lookout for opportunities, according to Chief Executive Officer Bob van Dijk.“I am excited about the deals that might happen because it would really reinforce the business we have,” he said in a phone interview this week. “The pipeline is looking quite healthy.”Prosus is competing with two bidders for EBay’s classified-advertising unit, according to people familiar with the matter. One is a consortium comprising buyout groups Blackstone Group Inc., Permira and Hellman & Friedman LLC and the other is Oslo-based online marketplace Adevinta ASA. Even some backers of these rival bids view Prosus as the heavy favorite, the people said.Representatives for EBay and Prosus declined to comment.EBay is seeking a sale of the unit at a time when market turmoil has hampered financing for leveraged buyouts, forcing companies to put a number of bidding processes on hold. The sale process is advanced and a decision on a winner is likely to happen in July, the people said.Prosus’s strong financial position and backing by Naspers will give it an edge in a tough environment for dealmaking. Winning the EBay bid could just be the fillip it needs for more M&A. Prosus’s shares declined 0.7% to 82.20 euros as of 12:01 p.m. Wednesday in Amsterdam.(Updates share price in final paragraph. A previous version of this story corrected the wording on timing of decision in penultimate paragraph)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.
(Bloomberg Opinion) -- Uber Technologies Inc. needs to act fast to buttress its food-delivery business. It now has a second chance and shouldn’t blow it.Late Monday, the New York Times reported that Uber Eats-parent Uber Technologies Inc. made an offer to acquire Postmates Inc., citing people familiar with the matter. A deal for Postmates would value the company at around $2.6 billion and could be announced next week or sooner, according to the Wall Street Journal. Reuters also reported on Monday that Postmates is considering an initial public offering as well.This isn’t Uber’s first attempt at consolidation for its food-delivery unit. Earlier this year, the company was in serious negotiations to merge with Grubhub, but lost out in a bidding war to Just Eat Takeaway.com NV. The European competitor announced a deal to buy Grubhub for $7.3 billion in early June. While this second option isn’t as ideal as the first for Uber, it’s still worth trying, and for the same reason: A merger would improve profitability and help make Uber Eats viable. As an industry in aggregate, Uber Eats and its three other U.S. food delivery competitors — DoorDash, Grubhub and Postmates — has been hemorrhaging cash as they compete against each other with lavish promotions and deals. Uber Eats alone lost more than $300 million in adjusted Ebitda, a measure of profitability, in its latest reported quarter, while Grubhub posted a $33 million loss for its first quarter.If Uber can take a player out of the equation, it would help rationalize the level of discounting, thereby lowering losses. Further, an Uber Eats-Postmates merger will likely generate significant cost savings as any overlapping administrative expenses can be eliminated.A Postmates acquisition also has the benefit that it would be more amenable on antitrust grounds. Some analysts have said worries over potential regulatory issues were part of what nixed the Uber Eats-Grubhub combination, which would have united two big players:An Uber Eats deal with Postmates would boost the combined companies’ total market share to around 30%. It would still allow for a robust level of competition for much of the country and be less likely of an issue for regulators to block. So, while Grubhub would have been a better deal for Uber with its larger market power and higher potential for cost synergies, a deal with Postmates is better than the status quo. Plus, it comes at a lower purchase price as well.The clock is ticking. Uber’s status quo isn’t sustainable. Yes, the company has a strong balance sheet with $9 billion in cash as of the end of its last quarter, but it also lost more than a billion dollars in those three months, too. Even a big cash pile won’t last long, if it doesn’t get its losses under control. A deal with Postmates would help fix that.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Tae Kim is a Bloomberg Opinion columnist covering technology. He previously covered technology for Barron's, following an earlier career as an equity analyst.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.
It looks like Uber Technologies (NYSE: UBER) didn't abandon the mergers and acquisitions market after failing to buy food delivery specialist Grubhub (NYSE: GRUB). The Wall Street Journal reports Uber is now in talks to acquire Postmates for $2.6 billion in a deal that could be announced next week or even sooner. Failing a merger, Postmates may go public.
(Bloomberg) -- Uber Technologies Inc. is in talks to purchase Postmates Inc., said a person familiar with the discussions, seeking to expand food delivery services in the U.S. and capitalize on a surge in orders during the coronavirus pandemic.Postmates is alternatively exploring various paths to go public, said the person, who asked not to be identified because the discussions are private. One option it’s considering would involve merging with a special purpose acquisition company, the person said.In the talks with Uber, a deal could value Postmates at $2.6 billion, according to the Wall Street Journal. Representatives for Uber and Postmates declined to comment. The New York Times reported earlier Monday that Uber had made an offer to acquire Postmates.Uber shares were up 4.1%, to $30.83 Tuesday morning in New York.Founded in 2011, Postmates was one of the first to let customers in the U.S. order meal delivery using a smartphone app. However, competition has grown intense in recent years, and Postmates is now a distant fourth. The company said in February 2019 that it had filed paperwork confidentially for an initial public offering but never went public. It raised a private investment later that year valuing the business at $2.4 billion.The effects of the virus have boosted food delivery, though it hasn’t resulted in profits. The market is highly competitive, and the margins are slim. A deal could help Uber Eats, Uber’s delivery arm, at a time when the pandemic has decimated Uber’s main business of ride hailing. In recent months, Uber has cut about a quarter of its staff and shed side businesses. The food delivery unit, Uber Eats, has been a bright spot for the company as more customers have ordered in, facing widespread restaurant closures.Postmates wasn’t Uber’s first choice for an acquisition. Uber attempted to buy Grubhub this year, but the proposed deal fell through earlier this month when European rival Just Eat Takeaway.com NV bought it instead. Uber’s bid for Grubhub, one of the larger players in the U.S. food delivery market, was likely to have raised antitrust concerns, according to analysts.(Updates shares in fourth paragraph.)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.
(Bloomberg) -- Uber Technologies Inc. is getting into software. The company is making the technology that powers its ride-hailing business available to others, starting with public transit agencies.California’s Marin County transportation providers are the first customers to buy access to Uber’s software in a deal the company announced Wednesday. The tie-up represents a potential new revenue stream for Uber at a time when the company could use it.“This is not a one-off. This is a new product and a new business,” said David Reich, head of Uber Transit, adding that the company intends to partner with other transit agencies in the future. “Together we want to make car ownership a thing of the past.”But the effort is starting small. The program, called Marin Connect, will power logistics for just four wheelchair-accessible vans when it begins on July 1. Teaming up with Marin Transit and the Transportation Authority of Marin, it will also make public transit schedules and discounts available within the Uber app in the county, and will offer vouchers for riders traveling the last mile to their destinations from transit stops.The two-year deal will cost $80,000, said Nancy Whelan, the General Manager of Marin Transit. “We pilot a lot of things,” Whelan said. “We try to stay nimble.” Marin Transit has also worked with transportation tech companies Lyft Inc. and Via in the past.Uber has had a rocky year since its initial public offering last spring. With only a few exceptions, Uber shares have consistently traded below their 2019 IPO price. Investor faith in the company has further dipped during the pandemic after shelter-in-place orders decimated its ride-hailing business and delayed its ambitions to turn a profit.With no clear timeline for returning to pre-pandemic demand levels, the San Francisco-based company last month slashed 25% of its workforce, shut dozens of offices around the world and is abandoning -- or considering abandoning -- all of its non-core businesses. Surging demand for food delivery has been a bright spot for Uber, but its recent attempt to purchase Grubhub failed. Rival Just Eat Takeaway.com NV agreed to buy Grubhub last week, creating one of the world’s largest meal delivery companies, ready to battle Uber for leadership in North America.Uber’s effort to re-purpose its software for others to use has been years in the making, according to Reich. Although the first deal is small, it could be the start of a reliable revenue stream in the future in the form of long term contracts. Uber is now talking with dozens of transit agencies around the world, Reich said.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.
After weeks of being serenaded, Grubhub (NYSE: GRUB) has finally chosen a suitor. The restaurant takeout marketplace will be sold to Just Eat Takeaway.com (OTC: TKAY.Y), a European leader in online restaurant takeout and delivery. The agreement ends weeks of suspense over a potential tie-up between Grubhub and Uber (NYSE: UBER), which had been in talks to merge Grubhub, the #2 U.S. restaurant delivery company, with Uber Eats, the #3 domestic food delivery app.
Grubhub's (NYSE: GRUB) stock recently popped after the American food delivery company agreed to merge with its European peer Just Eat Takeaway (OTC: TKAY.Y), which itself was formed by a recent merger between the U.K.'s Just Eat and Netherlands-based Takeaway. The all-stock deal, which values Grubhub at $7.3 billion, will exchange each Grubhub share for 0.671 shares of Just Eat, which implied a value of $75.15 per Grubhub share when the deal was announced. Merging with Just Eats would also likely avoid the antitrust scrutiny of a combination of Grubhub and Uber Eats, which would have combined the second- and third-largest food delivery platforms in the U.S., respectively, after DoorDash.
Following months of speculation that Uber might acquire GrubHub (NYSE: GRUB), the latter company has decided to instead merge with European food delivery company Just Eat Takeaway.com (OTC: TKAY.Y). The prospect of Uber Eats combining with GrubHub had already started to garner pushback from lawmakers over anticompetitive concerns. Unfortunately, more consolidation in the global food delivery industry will likely just hurt small local restaurants.
WeissLaw LLP is investigating possible breaches of fiduciary duty and other violations of law by the board of directors of Grubhub, Inc. ("GRUB" or the "Company") (NYSE: GRUB) in connection with the proposed acquisition of the Company by Just Eat Takeaway.com N.V. (AMS: TKWY, LSE: JET) ("Just Eat Takeaway"). Under the terms of the acquisition agreement, GRUB shareholders will receive American depositary shares ("ADS") representing 0.671 ordinary shares of Just Eat Takeaway, for each GRUB share that they own. The merger consideration represented an implied per-share value of approximately $62.29 based on Just Eat Takeaway's June 11, 2020 closing price of $92.83.1
(Bloomberg) -- Jitse Groen is a man in a hurry.In just the last two years, the 42-year-old Dutch billionaire and chief executive officer of Just Eat Takeaway.com NV has taken the food-delivery platform he created in his college dorm room two decades ago on a shopping spree, with more than $15 billion in takeovers.The $7.3 billion combination with Grubhub Inc. he detailed on Thursday catapults Just Eat Takeaway into one of the world’s largest food-delivery companies and, according to JPMorgan Chase & Co., gives it the coveted No. 2 spot in the brutally competitive U.S. market. The deal will put Just Eat Takeaway slightly ahead of Uber Technologies Inc., whose own efforts to buy Grubhub snagged on price and antitrust concerns.Read more: Just Eat Takeaway to Buy Grubhub for $7.3 Billion to Enter U.S.With the ink barely dry on his last deal -- the $8 billion combination of Takeaway and Just Eat in Europe that U.K. regulators approved less than two months ago -- Groen may be biting off more than he can chew with his U.S. foray, some fear.Asked about the timing of the deal so close on the heels of another mega-transaction, Groen said to analysts and investors on a conference call Thursday, “if you ask me, something like this should have happened three years ago but I wasn’t the CEO of Just Eat back then.” Previous mergers made the deal attractive to Grubhub, he said.Still, the U.S. market with its sliver-thin margins from an all-out price war between Uber Eats and market leader Doordash has created a “bloodbath,” according to ABN Amro analyst Wim Gille. There’s no protection for drivers’ incomes, restaurants have to pay high fees and customer experience is poor, he said.With those concerns in mind, some Just Eat Takeaway investors gave the deal a thumbs down. Since Groen’s talks with Grubhub leaked Friday on CNBC, Just Eat Takeaway shares have dropped about 15%.In the longer term, however, size is what may determine who thrives in the industry, Gille said.“From a strategic point of view, this is the right thing to do,” he said. “In the long run, the winner in the U.S. will own potentially one of the biggest profit pools in the developed world.”Long JourneySome investors concur.“Just Eat Takeaway.com’s acquisition of Grubhub is clever and sensible,” said Alex Captain, founder and managing partner of Cat Rock Capital Management, a Just Eat Takeaway shareholder. “Just Eat Takeaway.com is doubling its addressable market at a reasonable price through this acquisition.”For Groen, getting into the U.S. marks a giant step in the journey that started 20 years ago when, as a business and information technology student at the University of Twente in the Netherlands, he came up with the idea of creating a food-delivery business.The company he leads has operations in more than two dozen countries and had 415.9 million euros ($473.5 million) in revenue last year -- almost four times that in 2016, when Takeaway went public on the Amsterdam stock exchange.It has also made him a billionaire, with his 10.6% stake in Just Eat Takeaway valued at about 1.3 billion euros.‘Price to Beat’His deal with Matt Maloney, his counterpart at Grubhub and an old friend, seems to have gone through relatively smoothly.They both founded their food-delivery companies within a few years of each other. Maloney said he first met Groen in 2007 in Chicago, and the two have been in touch regularly ever since.“We have the same company on different continents,” Maloney said in an interview Wednesday. “There’s this mutual cosmic alignment.”Groen contacted him after hearing reports about Grubhub’s talks with Uber, Maloney said. When Groen learned the talks were turning serious, he moved in. Bloomberg reported that Uber had made an offer for Grubhub in May.Uber and Grubhub agreed on a ratio that valued each Grubhub share at 1.925 that of Uber on the condition they settled on a framework for securing regulatory approval, two people familiar with the matter said. At Friday’s closing price, that works out to about $6.6 billion.“Just Eat knew the bogey,” Maloney said. “They knew the price to beat.”Even with his penchant for large deals, Groen’s interest in Grubhub seems to be recent. Or if he had considered a bid, he kept it close to his chest. Asked on an earnings call in early April if he had picked a target for this year, the CEO said “no.”“It’s not like you can easily pick and choose M&A,” he added. “The stars need to be aligned.”Empire BuildingThe stars haven’t always aligned neatly for Groen, but he has not been shy about tenaciously pursuing competitors he’s set his sights on.When Takeaway snagged Delivery Hero’s German operations in late 2018, it snuffed out what had been an expensive rivalry in the country. The companies were at loggerheads, investing heavily in customer acquisition.About half a year later, Groen’s company lodged a bid for Just Eat, which eventually prompted a counter-offer by Prosus NV for the U.K. firm. That set off an often-ugly, grueling, months-long bidding war before Takeaway declared victory in early January -- but only after its rival had helped push up the price.Read more: Takeaway Wins Bidding War for Just Eat With $8 Billion Offer Now, armed with final regulatory approvals for the Just Eat Takeaway deal -- the company has yet to file a joint earnings report -- Groen has embarked on his next adventure with Grubhub.He faces an industry whose competitive landscape is only going to intensify as tech giants Uber and deep-pocketed Amazon.com Inc. expand in the space. Smaller players are also clawing for market share, with Delivery Hero last year taking control of South Korea’s biggest food delivery app Woowa Brothers Corp. at a $4 billion valuation.Still, the scale of Groen’s ambitions were evident when in an interview with Bloomberg in June 2018 he said that in his view “the most value is in being the largest, by far.”(Updates with investor comments in 9th paragraph)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.
Shares of Uber Technologies (NYSE: UBER) took a dive today as the ridesharing giant fell alongside the broader market sell-off and as it lost in its bid to acquire Grubhub (NYSE: GRUB), which instead agreed to sell itself to Just Eat Takeaway.com (AMS: TKWY). Uber stock finished the day down 10.7%. Grubhub revealed late Wednesday that it would sell itself to the European food delivery company Just Eat Takeaway.com in all-stock deal.
Yahoo Finance’s Emily McCormick joins Heidi Chung to discuss the Amsterdam-based company gearing up to purchase Grubhub in an all-stock transaction.
In a lightning-fast finish to the drawn-out saga of Grubhub's (NYSE: GRUB) negotiations with Uber Technologies (NYSE: UBER) over a merger, the food delivery service turned down Uber's advances and accepted an offer from Just Eat Takeaway.com (LSE: JET) in the space of less than 24 hours. Investors seem pleased by the news, with Grubhub's stock already up nearly 5% in Thursday morning trading. While Just Eat had a strong food delivery presence in Europe, Australia, Canada, and Central and South America, combining with Grubhub gives the company its first foothold in the United States.
Many analysts would have preferred sale to Uber. One writes that Grubhub managed to “snatch defeat from the jaws of victory.”