What’s Going On Here?Takeaway.com’s appetite for acquisitions seems bottomless: after buying the UK's Just Eat earlier this year, it’s now swallowing up American online food delivery platform Grubhub in a $7 billion deal. What Does This Mean?Both companies have the same mission in their respective stomping grounds: getting food from restaurant to doorstep. But while Dutch company Takeaway.com boasts a near-$15 billion market value (and a clumsy new name) following its merger with Just Eat, Grubhub is only worth $5.7 billion – even after acquiring rival Seamless in 2013.
The deal will be an “all-share merger”, meaning no cash will actually change hands. Instead, Grubhub’s investors will receive 0.671 shares of Just Eat Takeaway.com for every Grubhub share they own. That’ll value the American firm at $7.3 billion, as well as create the biggest online food delivery company outside of China. Why Should I Care?For markets: Ding ding ding – round two.
The merger should benefit both players. In the markets where they currently overlap, the reduced competition will limit marketing spend and in turn boost profit. And in the markets where they don’t, the combined company’s increased firepower will help blow its rivals out the water. Oh, and after managing to outgun Uber Eats in several regions outside the US, Just Eat Takeaway might be able to offer some pointers on how Grubhub can take down the big-hitter Stateside too…
The bigger picture: What a hassle.
Incidentally, Uber was also keen to pair its Eats platform with Grubhub – a deal that would’ve seen them control over half the American food delivery market. But maybe it was for the best: competition regulators mightn’t have been particularly accommodating. Just look at regulators in Europe, which plan to issue antitrust charges against Amazon over how it treats sellers on its marketplace – or in the UK, where they’re mulling over whether Amazon’s investment in food delivery service Deliveroo will unfairly limit competition. | 
