Just Eat Takeaway is set to acquire food delivery rival Grubhub for $7.3 billion (£5.76) making it the world’s largest food delivery company outside of China.
Just weeks after Just Eat and Takeaway.com’s £6 billion merger was approved by competition authorities in the UK, the newly combined entity has penned another landmark consolidation deal.
Should the deal receive regulatory approval it is expected to be completed in early 2021, which will see Grubhub investors own around 30 per cent of the newly combined entity, while Just Eat Takeaway shareholder will control 70 per cent.
The newly consolidated company will have more than 70 million active customers across its combines markets, placing around 600 million orders a year making it the largest player in Europe and the US by some margin.
Grubhub was initially approached by Uber in February for a potential acquisition, and as late as last week it was still considered the front runner even as others expressed interest.
Despite this the Silicon Valley based ride hailing giant, which also operated Uber Eats, failed to move fast enough and reassure Grubhub over antitrust concerns.
This allowed Just Eat Takeaway chief executive Jitse Groen to “move swiftly” and beat Uber to a deal.
“Would it be better to just wait one year after every transaction? Yes, sure. We’d get more sleep. But that’s just not how the world turns,” Groen said.
Grubhub’s chief executive Matt Maloney took a more aggressive stance, telling the Financial Times that this deal will give the company the “financial strength and flexibility . . . to be as aggressive as possible and able to take the fight to Silicon Valley”.
“If Uber is going to get an inch, they are going to have to fight for that in every single market in the United States. Broadly, this is about building the number one pure-play food delivery platform outside of China”.
Grubhub’s shares rose more than four per cent in after hours trading.