European meals supply big Simply Eat Takeaway.com is promoting Grubhub for $650 million, a fraction of the billions it spent to purchase the US platform simply three years in the past.
Surprise Group, a New York-based meals ordering firm that touts “fast fine” eating, is about to be Grubhub’s new proprietor.
Underneath phrases of the deal, introduced Wednesday, Surprise will purchase Grubhub from Simply Eat Takeaway.com for $150 million in money and $500 million in senior notes.
That’s far lower than the value tag on Grubhub’s final sale.
Again in 2020, in the course of the early days of the COVID-19 pandemic and a surge in demand for takeout meals, Simply Eat agreed to purchase Grubhub for $7.3 billion — reportedly beating Uber to a merger — in a transaction that was later finalized in 2021.
Amsterdam-based Simply Eat Takeaway.com acknowledged Wednesday that it had been “actively exploring” the partial or full sale of Grubhub for a while, citing prior bulletins from the corporate.
Simply Eat Takeaway.com added that promoting Grubhub to Surprise would improve progress, money technology and assist funding in international locations the place it “has the greatest competitive advantage.”
Past the US the corporate at the moment operates in 18 different international locations.
The transaction is predicted to shut in the course of the first quarter of 2025, topic to regulatory approval and different customary circumstances.
When accomplished, Simply Eat Takeaway.com says it can retain no materials liabilities associated to Grubhub.
“This deal delivers the right home for Grubhub and its employees,” Simply Eat Takeaway.com CEO Jitse Groen stated in an announcement. Shares of the corporate had been up over 15% by noon Wednesday.
The CEOs of Surprise and Grubhub, Marc Lore and Howard Migdal, additionally sounded constructive notes Wednesday — with each noting that the deal would assist Surprise’s mission to “make great food more accessible” and improve buyer experiences.
Surprise, based by Lore, payments itself as a “new kind of food hall” and delivers made-to-order meals from well-known cooks and eating places.
Helayne Seidman
The New York startup was as soon as recognized for its fleet of supply vans, however later transitioned to a extra of a brick-and-mortar method. Its on-line choices have additionally grown.
Final 12 months, Surprise bought meal equipment firm Blue Apron for $103 million.
Grubhub, headquartered in Chicago, operates in additional than 4,000 US cities — with over 375,000 retailers and 200,000 supply companions throughout the nation to this point.
In keeping with Simply Eat Takeaway.com, the platform generated 237 million orders with a gross transaction worth of about $8.53 billion final 12 months.
Takeaway.com, which merged with Simply Eat in 2020, and Grubhub had been each based within the early 2000s — making them a number of the earliest entries within the sector.
However competitors quickly elevated as now-popular platforms like Uber Eats and DoorDash additionally joined the sport. And prospects leaping between apps could make it tough to maintain gross sales steady.
As of March 2024, numbers from information analytics agency Bloomberg Second Measure confirmed that Grubhub made up solely 8% of meal supply client spending within the U.S. — far lower than DoorDash or Uber Eats.
DoorDash is at the moment profitable the “food delivery war,” per Second Measure, making up 67% of those gross sales, adopted by Uber Eats’ 23%.
This story has been up to date to appropriate that GrubHub generated a gross transaction worth of 8.06 billion euros, not million.
