Just Eat at risk of cheap takeover bids, says major shareholder


Just Eat Takeaway.com was under pressure from investors on Tuesday after one of the food delivery app’s biggest shareholders called on the firm to take action or run the risk of a bargain-basement takeover.

Cat Rock Capital, which owns a 4.7% stake in Just Eat, said that the group should look at strategic options including divestments or another merger with a rival, adding that if nothing is done the company could be vulnerable to a cheap offer.

READ: Just Eat Takeaway eyes road to profits as losses ‘peaked’ in first half

The shareholder also criticised Just Eat’s communication with investors, which it said was “deeply flawed” and was responsible for making it “the worst-performing online food delivery stock over the past two years despite strong operational performance”.

“The company has not been transparent in communicating the costs of its investments and the corresponding short-term impact on [earnings], seriously undermining its credibility with the market”, Cat Rock said.

The shareholder also accused the company of having “publicly criticized the potential of businesses it is actively investing in, such as logistics and grocery delivery, causing immense confusion and misunderstanding” as well as failing to address “competitor attacks and correct misinformation on its operational acumen”.

“Just Eat Takeaway.com is a fantastic business with #1 positions in many of the world’s most valuable online food delivery markets and a long runway for growth. However, JET has failed to upgrade its communications with investors and the markets since IPO, leaving it deeply undervalued and vulnerable to takeover bids at far below intrinsic value”, Cat Rock’s founder and managing partner Alex Captain said in a statement.

To resolve the aforementioned issues, Cat Rock suggested that Just Eat “needs to provide investors with transparency on the expected magnitude, composition, and returns of its investments” as well as disclosure on the “current and future unit economics of its logistics and grocery businesses”.

Other proposed solutions included selling non-core assets to address what Cat Rock said was the “deep undervaluation” of the company’s equity, as well as exploring “strategic combinations with other global players that could…generate significant shareholder value”.

“JET can quickly and materially improve its standing in the capital markets by improving transparency, selling non-core assets, and exploring strategic options to strengthen the business and generate significant shareholder value. We remain incredibly excited about JET’s prospects and look forward to continued engagement with management and shareholders to help the Company achieve its great potential”, Captain said.

Cat Rock’s intervention appeared to have garnered some support among other investors, with Just Eat shares up 2.2% at 6,123p in late morning deals.


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