AMSTERDAM Reuters- Shares in Europe's largest online meal ordering company Just Eat Takeaway.com hit an all-time low on Tuesday, amid doubts that the company will sell its U.S. Grubhub operation, and whether it will reach profitability without additional funding.
The shares fell 19% to 14.68 euros in a fierce sell off, following a note by Berenberg analysts initiating coverage with a Sell rating. The analysts questioned whether the company would be able to dispose of Grubhub for anything resembling the $5.8 billion it paid for it in an all-shares acquisition that closed in June 2021.
Just Eat Takeaway was not immediately available for comment. The shares are down 70% this year and Chief Executive Jitse Groen has been under fire from investors, including its second-largest shareholder Cat Rock, for the Grubhub purchase. Groen, Takeaway's founder, reversed course in April 2022 and said he was considering options including a sale of the business.
On our estimates, the company would need to raise around 1 billion in new funding to achieve free cash flow break-even if it doesn't sell Grubhub or other assets, according to Berenberg analysts.
We think the disposal of Grubhub could bring in net $400 million, but that still means a need for over 500 million euros in new funding. A report in the Wall Street Journal cited remarks by Grubhub CEO Adam DeWitt that a sale of the division is not imminent.
In 2021 takeaway reported a more than 1 billion euro loss, though Groen has said it is on track to become profitable on an operating basis in 2023.
At a fractious shareholder meeting in May, Supervisory Chairman Adriaan Nuehn said he would not seek reappointment.
The commissions it charges restaurants in European markets other than Britain are going to be increased by 1 percentage point, according to a report this week.