Just Eat Takeaway, a European food delivery service, said on Wednesday that it had agreed to buy Grubhub for $7.3 billion, a deal that would give it a foothold in the United States.
In the all-stock deal, Just Eat Takeaway said it would value Grubhub at $75.15 per share, a 27 per cent premium to Grubhub's closing price of $59.05. Grubhub's founder and chief executive, Matt Maloney, will join Just Eat Takeaway's board and oversee its business in North America, the companies said.
"I am excited that we can create the world's largest food delivery business outside China, " Jitse Groen, chief executive of Just Eat Takeaway, said in a statement. Maloney said the companies would place "extra value on volume at independent restaurants, driving profitable growth".
Uber had been in talks to buy Grubhub, but those discussions foundered over price and regulatory concerns, said people with knowledge of the discussions. If Uber had bought Grubhub and combined it with Uber Eats, the result would have been the largest food delivery service in the United States, with about a 55 per cent market share. That had attracted antitrust scrutiny.
An Uber spokesperson said the company would continue looking for deals in the food delivery business, but would not engage in “any deal, at any price, with any player”.
Food delivery has become more popular during the coronavirus pandemic. People have turned more toward services such as Grubhub, DoorDash and Uber Eats as restaurants shut down in-room dining during the early phases of the outbreak. Restaurants are slowly beginning to reopen.
Even so, profits in the food delivery business have been elusive. Uber Eats, DoorDash and Grubhub have all spent millions of dollars on marketing and incentives to lure customers away from the others. Grubhub, which had been profitable, began losing money as it spent more to fight off rivals. – New York Times Service