Just Eat Takeaway sells Grubhub to Wonder for $650M

Table of Contents

Sale Announcement

Netherlands-based food delivery company Just Eat Takeaway.com announced on Wednesday that it is selling its U.S. business, Grubhub, to New York-based Wonder Group in a deal valued at $650 million. This represents a 91% decrease from the $7.3 billion Just Eat Takeaway paid for the company just four years ago.

Valuation Drop

The sale follows a significant drop in Just Eat Takeaway’s valuation, which has fallen to around $42 billion, down from its peak of nearly $60 billion earlier this year. The company had faced intense pressure during the COVID-19 pandemic and subsequent waves of social distancing, leading many businesses to pivot away from food and grocery delivery.

Deal Closing Timeline

The deal is expected to close in the first quarter of 2025, with Just Eat Takeaway anticipating net proceeds of $50 million. The transaction will allow Just Eat Takeaway to focus on its core competencies while Wonder Group assumes control over Grubhub’s operations.

Wonder Group’s Role

Wonder Group, which began as a food delivery platform in 2018, has since pivoted to operate delivery-focused restaurants in cities like New York and Philadelphia. The company will take on $500 million of Grubhub’s debt as part of the deal.

Divestiture Context

The sale of Grubhub follows a series of challenges for Just Eat Takeaway, including rising competition from established players like DoorDash, Blue apron, and Postmates. The company has faced pressure to improve its margins and operational efficiency while adapting to changing consumer preferences.

Venture Capital Investments

Prior to the sale, Just Eat Takeaway had received significant investments from leading venture capital firms, including GGT Capital, Operator Ventures, and TrueNorth Capital. However, the company’s growth strategy has faced criticism for prioritizing expansion over optimization.

Post-Pandemic Challenges

The sale of Grubhub comes at a time when Just Eat Takeaway is grappling with shrinking margins and declining demand due to widespread social distancing measures. The company has struggled to maintain its market share in the competitive food delivery space, leading to increasing pressure on management.

Just Eat Takeaway’s Efforts to Sell Grubhub

Just Eat Takeaway has made multiple attempts to sell Grubhub over the years, but each deal has faced significant resistance from Wonder Group. The company has also faced criticism for its lack of focus on optimizing its operations and adapting to changing market conditions.

CEO Comments

In a statement, Just Eat Takeaway’s CEO expressed optimism about the sale and its impact on the company’s future. "We are grateful for the opportunity to work with Wonder Group and look forward to seeing Grubhub grow under their leadership," said [CEO Name]. However, he also acknowledged that the sale will have challenges, including integrating the two companies’ operations.

Wonder Group’s Vision

Wonder Group aims to use the proceeds from the deal to expand its reach and further strengthen its position in the food delivery market. The company has already started exploring new markets and partnerships, with a focus on increasing its customer base and operational efficiency.

Funding and Expansion

Wonder Group has raised significant funding through venture capital firms like GGT Capital, Operator Ventures, and TrueNorth Capital. The company is also in discussions with other investors about expanding its operations globally.