Just Eat keen to put Grubhub on sale as $7.3 billion bet goes sour

The logo for the Grubhub Inc. application is displayed on an Apple Inc. laptop computer in an arranged photograph taken in the Brooklyn borough of New York, U.S., on Friday, April 10, 2020. Grubhub, the parent of food delivery app Seamless, said last month it was deferring fees for independent restaurants using the service in response to the coronavirus pandemic. Photographer: Gabby Jones/Bloomberg

Just Eat Takeaway.com NV said it’s considering a partial or full sale of its Grubhub unit as the food-delivery firm struggles to cope with the end of the pandemic.

The Amsterdam-based company said in a statement it’s exploring strategic actions for the U.S. division, which it bought for $7.3 billion last year. Just Eat’s shares have plunged as investors lost faith in its plans to involve the division in industry consolidation, as it has yet to announce any tieups with the unit.

It also pared its projections for 2022 and now says gross transaction value will grow by mid-single digits percentage points year on year, down from an earlier estimate for a gain in the mid-teens percentage points. After attracting a surge of customers as lockdowns took hold across its key markets, it’s now finding that people aren’t as keen to order food at home.

Key Insights

• The company said orders on its platform rose less than expected at the start of this year, total orders of 264.1 million, missing the 286.5 million orders expected by analysts in a Bloomberg survey.
• “Our priority for 2022 lies in enhancing profitability and strengthening our business. We expect profitability to gradually improve throughout the year, and to return to positive adjusted EBITDA in 2023,” Chief Executive Officer Jitse Groen said in a statement.
• North America was the chief laggard with a 5% drop in orders year-on-year. The U.K. and Ireland was flat while Northern Europe had a 4% gain in the same period.
• Rival Deliveroo Plc said earlier this month customers ordered less than expected at the start of this year.