Amazon teams up with Just Eat with Grubhub investment

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The deal is a major relief for Just Eat Takeaway, whose shares have fallen 70% this year as shareholders demanded it sell or find a partner for Grubhub, which it bought just last year for $5.8 billion in shares.

There is"no crystallisation of value, albeit door is open for more," the bank said.Under the deal announced as part of Amazon's July"Prime Day" promotion today, Amazon customers will receive free delivery on orders over $12 in the 4,000 cities where Grubhub operates.

The deal will drive traffic for Grubhub, which has lost share to Doordash and Uber Eats as the impact of the Covid-19 pandemic wanes. In exchange, Amazon will receive warrants representing 2% of Grubhub's shares, and an additional 13% of shares conditional on the deal bringing Grubhub enough customers.

"The agreement is expected to expand membership to Grubhub+, while having a neutral impact on Grubhub's 2022 earnings and cash flow, and be earnings and cash flow accretive for Grubhub from 2023 onwards," Just Eat Takeaway said in a statement. The company said that Grubhub's gross assets were worth €6.5 billion at the end of 2021, and it made a pretax loss of €403m in that year.

 

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