Cat Rock calls on Just Eat to explore combinations, sell non-core assets

Just Eat Takeaway.com should explore combinations with other global players and consider selling non-core assets if it wants to defend itself against a potential hostile takeover, according to one of the company’s largest shareholders.

  • Just Eat Takeaway.Com N.V. (CDI)
  • 27 July 2021 11:00:27

Source: Sharecast

In a statement on Tuesday, Cat Rock Capital said it had been "deeply disappointed by the company’s poor handling of its relationship with investors". It argued that Just Eat’s "flawed communication" has made it the worst-performing online food delivery stock over the past two years despite a strong operational performance.

Cat Rock noted the share price has fallen 11% over the past two years even as the gross merchandise value has grown more than 100%. As a result, the company’s valuation has declined by 75% to around 11x revenue in mid-2019 to just 2.6x revenue currently.

Cat Rock outlined several ways it reckons Just Eat could fix its problems. It said the company needs to provide investors with transparency on the expected magnitude, composition, and returns of its investments. Specifically, it should provide disclosure on the current and future unit economics of its logistics and grocery businesses.

In addition, the firm needs to "aggressively address and exploit the deep undervaluation of its equity" by selling non-core assets, using the proceeds to invest in its growth and repurchase the shares issued in the Grubhub transaction.

Just Eat should also explore strategic combinations with other global players, it said.

Cat Rock founder and managing partner Alex Captain said: "Just Eat Takeaway.com is a fantastic business with #1 positions in many of the world’s most valuable online food delivery markets and a long runway for growth.

"However, JET has failed to upgrade its communications with investors and the markets since IPO, leaving it deeply undervalued and vulnerable to takeover bids at far below intrinsic value.

"JET can quickly and materially improve its standing in the capital markets by improving transparency, selling non-core assets, and exploring strategic options to strengthen the business and generate significant shareholder value.

"We remain incredibly excited about JET’s prospects and look forward to continued engagement with management and shareholders to help the company achieve its great potential."

Exchange: London Stock Exchange
Sell:
0.00
Buy:
0.00
Change: 15.44 ( 0.17 %)
Date:
Prices delayed by at least 15 minutes

Compare our accounts

If you're looking to grow your money over the longer term (5+ years), we have a range of investment choices to help.

Lloyds Bank is not responsible for the content and accuracy of the Markets News articles. We may not share the views of the author. Understand the risks, please remember the value of your investment can go down as well as up and you may not get back the full amount you invest. We don't provide advice so if you are in any doubt about buying and selling shares or making your own investment decisions we recommend you seek advice from a suitably qualified Financial Advisor. Past performance is not a guide to future performance.

Important legal information

Lloyds and Lloyds Bank are trading names of Halifax Share Dealing Limited. The Lloyds Bank Direct Investments Service is operated by Halifax Share Dealing Limited. Registered Office: Trinity Road, Halifax, West Yorkshire, HX1 2RG. Registered in England and Wales no. 3195646. Halifax Share Dealing Limited is authorised and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN under registration number 183332. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.

Logo Allfunds

The information contained within this website is provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd unless otherwise stated. The information is not intended to be advice or a recommendation to buy, sell or hold any of the shares, companies or investment vehicles mentioned, nor is it information meant to be a research recommendation. This is a solution powered by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd incorporating their prices, data news, charts, fundamentals and investor tools on this site. Terms and conditions apply. Prices and trades are provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd and are delayed by at least 15 minutes.

FE fundinfo Logo

Data provided by FE fundinfo. Care has been taken to ensure that the information is correct, but FE fundinfo neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.

Refinitiv Logo

© 2025 Refinitiv, an LSEG business. All rights reserved.