Just Eat Recommends Declining Prosus Offer In Favor Of Takeaway

Just Eat Recommends Declining Prosus Offer

British online food and delivery company Just Eat is asking its shareholders to hold off on approving an offer from Prosus, saying they should accept a smaller deal from Takeaway.com instead, according to a report by Reuters.

The Prosus deal is worth $6.3 billion in cash, and would create the largest delivery service in the world outside of China.

“Your board believes that the Takeaway.com combination provides Just Eat shareholders with greater value creation than the Prosus offer,” Just Eat said to investors.

Netherlands-based Prosus offered 710 pence a share, which Just Eat said undervalued the company. Takeaway.com said it was “strongly committed” to the pursuit of the deal and wanted it to move forward.

Takeaway.com’s offer is worth about 684 pence a share, while Just Eat shares traded at 755 pence on Monday (Nov. 25).

“Our team has a proven ability to win in competitive markets and has defeated numerous competitors in many countries, whether large-scale tech giants or well-funded, own-delivery challengers,” said Takeaway.com Chief Executive Jitse Groen. “We remain strongly committed to the merger.”

Prosus said that it was offering a better deal than Takeaway.com, and that it had more to offer in terms of delivery, marketing and technology.

“We continue to believe the Takeaway.com offer represents a significant risk to Just Eat shareholders based on Takeaway.com’s very high (share price to earnings) multiple and the level of investment required to address what customers now expect,” noted Prosus CEO Bob van Dijk. “We continue to believe our offer is the right one for Just Eat shareholders and provides compelling and certain value.”

This isn’t the first time Just Eat has rejected a buyout bid from Prosus. In October, Prosus offered $6.2 billion and that was turned down as well. Just Eat’s board “unanimously recommends that shareholders reject the Prosus offer,” the company said at the time.