Just Eat Takeaway’s US adventure now looks like terrible mistake

theguardian.com:

In the world of techie businesses fuelled by hope and sky-high multiples of revenues, it’s not only Netflix that has stalled. Look at Just Eat Takeaway, which used to present itself as a deal-a-minute company taking a short-cut to global leadership and profits.

Takeaway.com, out of the Netherlands, bought Just Eat of the UK in early 2020 via a reverse takeover (briefly assuming a place in the FTSE 100 index before decamping back to Amsterdam). Only a few months later it announced plans to merge with US operator Grubhub via a $7.3bn all-paper deal at a fat premium. To sceptics who said two mega-transactions in rapid succession would be too much to swallow comfortably, chief executive, Jitse Groen, argued, in effect, that you have to seize the moment in the fast-moving delivery game.

Now, with the share price down 70% from its highs, the American adventure looks an expensive mistake. A “strategic partner” will be sought; alternatively, Just Eat will sell part or all of Grubhub. In other words, a strategic U-turn is on the cards in no time at all. Shareholders, including 6% owner Cat Rock, which was gung-ho for Grubhub at the time, seem to have decided that concentrating on Europe is a safer bet.

They’re probably correct, though ought to have reined in Groen’s over-ambition in the first place. The result is a fine old mess. It would be a miracle if Grubhub fetches anything like the price that Just Eat paid for it since the two obvious US acquirers, Uber Eats and DoorDash, would surely be offside on competition grounds.

Meanwhile, valuations have plummeted across a sector where virtually nobody is making a real bottom-line profit, as opposed to a massaged “adjusted” number. Deliveroo has avoided Just Eat-style calamities on the