Uber has wasted on a high-profile deal, which would have provided this food delivery business a significant boost that saw a surge of demand during the pandemic. Just Eat Takeaway has offered to acquire the US-based Grubhub app for $7.3bn (£5.8bn) in a deal that would build the world’s largest food delivery service outside China.
Uber was trying to buy Grubhub as the integrated food ordering and distribution company would have rivaled the industry leader DoorDash or maybe even surpassed it. Soon after discussions between both the two companies were publicly disclosed in May, a bunch of U.S. senators warned the top antitrust authorities in the country asking for scrutiny of the potential deal.
Grubhub values at $7.3 billion. Its shares in after-hours trading jumped 6 percent. The merger is subject to shareholders’ approval of the company and is expected to close early next year, would also mark the entry of Just Eat Takeaway into the US. The company currently operates in 23 countries.
Grubhub has also reportedly recently been acknowledged by US lawmakers’ rising pressure. It is still likely that the agreement with Just Eat Takeaway will attract several other criticisms, just not the same. Just Eat Takeaway itself is the outcome of a tie-up between British service Just Eat and Takeaway.com, a Dutch company.
And under contract terms that will require approval by both sets of shareholders, the shareholders of Grubhub will own 30 percent of the group. During the pandemic, there had been an increase in demand in the foodservice industry when government shutdowns prohibited restaurants from feeding diners at their premise.
Grubhub was founded in 2004 and has managed to help to promote the meal delivery concept. Nevertheless, the company has faced intense competition in the marketplace in recent years from the likes of Uber, DoorDash, and Postmates, each of which was well-funded through venture funding. In particular, Uber didn’t fear losing billions to new market opportunities and segments.