Even now the critics would come round, they had always done that.
Confronted with the growing unrest surrounding his company, Jitse Groen (43), CEO of meal delivery company Just Eat Takeaway.com (JET), has shown herself confident in recent months. He said it was only a matter of time before shareholders would see the value of the American subsidiary Grubhub.
Groen was used to having to convince others that he was right. When he ventured to Germany in 2007, everyone also asked him why he took the gamble for a “no chance of fourth place”. Until seven years later he first took over the much larger Lieferando and then ousted market leader Delivery Hero. Suddenly the outside world saw what Groen had known for years: that he could develop his company into a global player due to the dominance in Germany.
Yet it seems unlikely that the founder of Thuisbezorgd.nl will once again succeed in winning over his opponents. At the end of last year, an activist major shareholder already called for the sale of the struggling Grubhub and since then the discontent among investors has only grown. This led to a turnaround this Wednesday: if Groen rejected a sale earlier, that is now a possibility.
In an explanation of the first quarter figures, JET (EUR 5.3 billion turnover, 18,000 employees) stated that it was “actively looking” for a strategic partner or looking at a “part or full sale” of Grubhub. The company has asked its advisers to set up a “formal process”. There are currently no serious negotiations, according to the CEO.
unfortunate timing
Why founder Groen has now changed his mind? According to him, JET is regularly approached with proposals and offers. “Then we’ll see if that makes sense for our company.” In recent months, Grubhub has been looking for possible collaborations and an acquisition was discussed in some of those conversations, according to Groen. In short: the option was already on the table internally, “but now we are also communicating it externally.”
Also read this interview with a shareholder of Just Eat Takeaway: ‘Top man Jitse Groen is megalomaniac and stubborn’
Should it come to a sale, the Dutch meal delivery company will lose access to the huge American delivery market. Grubhub was probably the last opportunity to participate, Groen said earlier in NRC† The announcement of the acquisition in the summer of 2020 actually came a little too early: At that time, Takeaway was still busy finalizing the merger with Just Eat from a year earlier. “But you have one moment, that’s it.”
In retrospect, the timing of that purchase turned out to be unfortunate. Grubhub needed more patch work than expected. The platform had stalled a bit compared to the competitors. Groen wanted to solve that by adding more restaurants, especially outside city centers, and also focusing on home delivery, he announced one day for investors at the end of last year.
That repair work was made more difficult by the corona pandemic: while the measures allowed meal delivery to flourish, several regions in North America also set limits on how much brokerage costs delivery workers could charge to customers and restaurants. Moreover, when the measures were lifted, the explosive growth completely collapsed. Last quarter, for the first time, JET settled fewer orders than a year earlier.
Power evaporated
At the same time, the company’s shareholders saw their wealth quickly evaporate. This led to concerns among investors: with a low price, the second largest meal delivery company in the world could just be taken over in its entirety.
In Wednesday’s statement, JET now says it is “aligning” its own ambitions with those of its shareholders: to add value for the company and its owners. The question is how much value the sale of Grubhub can bring. Due to the low share prices of many meal delivery companies, it seems unlikely that Groen will get back in full the 6.4 billion euros he paid for Grubhub a year ago.