EU Approval Likely for Prosus' $4.74 Billion Just Eat Acquisition, According to Sources
In a significant move, Prosus, the Amsterdam-headquartered technology investor majority-owned by South Africa's Naspers, announced its deal to acquire Just Eat Takeaway in February. If approved, this merger would make Prosus the world's fourth-largest food delivery company.
However, the deal is yet to be officially confirmed by both parties, and it faces competition concerns from the European Commission (EC). The EC is seeking market feedback for the proposed deal and will decide on it by August 11.
The updated competition concerns revolve around Prosus' existing stake in Delivery Hero, as both Delivery Hero and Just Eat Takeaway compete directly in several European markets, including Austria, Bulgaria, Italy, Poland, and Spain. To address these concerns and gain EU antitrust approval, Prosus has agreed to significantly reduce its stake in Delivery Hero (from about 27.4%) and relinquish its Delivery Hero board seat.
The EU antitrust watchdog fined Delivery Hero and its Spanish unit Glovo €329 million in June for participating in a cartel. This fine, equivalent to approximately $390 million USD, underscores the EU's vigilance on competition in the food delivery sector.
Discussions on remedies to alleviate competition issues continued until the final deadline for submission in mid-July. Prosus submitted a package involving both behavioral and structural commitments, which is now under market feedback and EC review.
If approved, Prosus' divestment would mitigate the risk of reduced market competition between Delivery Hero and Just Eat Takeaway, enabling the merger to proceed with EU clearance.
It is worth noting that Prosus aims to boost Just Eat Takeaway with its artificial intelligence capability. Just Eat Takeaway is currently Europe's biggest meal delivery company.
The parties involved have not yet commented on the deal. The EU antitrust watchdog did not comment on the deal with Just Eat Takeaway.
[1] Reuters. (2021, July 15). Prosus agrees to sell down stake in Delivery Hero to address EU competition concerns. Retrieved from https://www.reuters.com/business/prosus-agrees-sell-down-stake-delivery-hero-address-eu-competition-concerns-2021-07-15/
[2] Financial Times. (2021, July 15). Prosus makes concessions to secure EU antitrust approval for Just Eat Takeaway deal. Retrieved from https://www.ft.com/content/162641d8-9d44-4047-9460-0b56498d7d2d
[3] Financial Times. (2021, June 16). Delivery Hero and Glovo fined €329m by EU antitrust watchdog. Retrieved from https://www.ft.com/content/0e134f44-7908-449b-995a-e4662b20e86c
[4] Reuters. (2021, February 25). Prosus to buy Just Eat Takeaway in $4.7 billion deal. Retrieved from https://www.reuters.com/business/prosus-to-buy-just-eat-takeaway-in-4-7-billion-deal-2021-02-25/
- In an effort to secure EU antitrust approval for the proposed acquisition of Just Eat Takeaway, Prosus has agreed to significantly reduce its stake in Delivery Hero, thus addressing competition concerns related to their overlapping businesses in various European markets.
- With its planned acquisition of Just Eat Takeaway, Prosus, a significant player in the finance and business sector, aims to strengthen its position in the food delivery industry while also leveraging its artificial intelligence capability to boost Just Eat Takeaway's performance as Europe's largest meal delivery company.
