Uber lost out on its pursuit of Grubhub
The all-stock deal values Grubhub at $7.3 billion. Its shares jumped 6% in after-hours trading.
The merger, which is subject to approval by the companies’ shareholders and is anticipated to close early next year, will mark Just Eat Takeaway’s entrance into the US. The company currently has operations in 23 countries.
With skyrocketing demand for delivery during the coronavirus pandemic, Uber’s meal service, Uber Eats, has been viewed as a bright spot for the company at a time when its core ride-hailing business has declined due to people increasingly staying home.
In a statement Wednesday afternoon, Uber spokesperson Noah Edwardsen said, “Like ridesharing, the food delivery industry will need consolidation in order to reach its full potential for consumers and restaurants. That doesn’t mean we are interested in doing any deal, at any price, with any player.”
Grubhub was founded in 2004 and helped popularize the concept of meal deliveries. In recent years, however, the company has faced fierce competition in the market from the likes of Uber, DoorDash and Postmates, each of which were well funded by venture capital. Uber, in particular, was not afraid to lose billions to expand into new markets and categories.