The bidding war for Just Eat (JE.) presses on. Naspers upped its offer from 710p to 740p a share on 9 December, noting that this constitutes a 24.6 per cent premium to the value of Takeaway.com’s offer of 594p – based on the latter’s closing price of €71 (£60) on 21 October (the day before the date of Naspers’ original offer announcement). But Just Eat’s management, which continues to recommend an all-share combination with Takeaway.com, believes Naspers’ revised offer still “significantly undervalues” the company.
While Naspers aims to buy out Just Eat, Takeaway.com’s offer would see the two companies combine to create “the largest online food delivery platform outside China”. An investor circular published by Takeaway.com this week said shares in the joint entity could be “illustratively worth [around] £11 each”, if they were valued at the bidder’s average trading multiple since its own 2016 initial public offering. But Naspers attacked this claim as “implausible”.
Takeaway.com’s pitch to investors is that the combined group would be able to see off competition from well-funded rivals Uber Eats and Deliveroo, which have grown rapidly in recent years, to become a dominant player in the field and – hopefully – command a much higher share price. Naspers is positioning itself as the low-risk offer, acquiring the shares for a higher initial per-share value than implied by Takeaway.com’s offer, but with no upside potential. In Naspers’ previous offer document from 11 November, it highlighted the drop in the high-growth internet sector and Takeaway.com’s share price since the offer period began. It has also lowered the threshold for acceptance of its offer to 50 per cent of the shares plus one.
Cat Rock, the activist investor that has been pushing for a combination between Just Eat and Takeaway.com since before it was announced, published a presentation outlining the investment case for the deal – noting its strong network effects, recurring revenues and high gross margins.
