Many companies in the UK have proved that merging with a rival is an effective formula to stay ahead of the field. Takeaway.com is about to follow suit in hopes of building a $10 billion empire that would beat Amazon-backed Deliveroo and Uber Eats.
The Dutch food delivery company made a $6.2 billion bid for British rival Just Eat, a move to expand its services and secure its position as leader in Europe’s fast-growing food delivery industry.
Although Just Eat has confirmed the possible acquisition, it says nothing is certain at this time. Analysts who were interviewed about the issue are still expecting a potential counterbid to Takeaway’s offer from companies like Delivery Hero and Naspers.
Under UK’s takeover rules, though, the two companies have only until August 24 to get approval from their respective board of directors and shareholders.
Mastering the art of befriending rivals
It’s not the first time that Takeaway has offered to buy a rival company’s business. Last year, it bought the German unit of its top competitor Delivery Hero for $1.1 billion, to end an expensive battle for Germany’s market.
Under the merger with Just Eat, Takeaway.com’s founder and chief executive officer, Jitse Groen, will assume the role of CEO while Just Eat Chairman Mike Evans will be its chairperson.
Just Eat’s stockholders will own 52.2% of the combined entity, leaving Takeaway’s with 47.8%. Takeaway was established in 2000 and now has more than 44,000 restaurants on its platform.
The food delivery company has a market capitalization of $5.7 billion while Just Eat has $5.3 billion.
What are your thoughts on this possible merger? Is it another example of monopolisation within an industry and does it create a much harder space for innovators to break in to?
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