Just Eat to buy Hungryhouse for more than £200m
-The company also this morning announced it had agreed to buy Canadian delivery platform Skip The Dishes for £66.1m. Just Eat said that on a proforma basis it would expect Hungryhouse to generate EBITDA of between £12-15m in 2017, excluding one-off exceptional transaction and integration costs of around £1m.
According to BigHospitality's sister publication MCA Insight, the group announced to the City this morning that a bid had been agreed with Delivery Hero Holding for an initial consideration of £200m with a further £40m potentially payable subject to the performance of Hungryhouse between signing and completion of the deal.
The acquisition will be subject to approval by the Competition and Markets Authority.
David Buttress, chief executive of Just Eat, said: “The UK has long been an engine of growth for Just Eat. While we have significantly expanded internationally in recent years, we have remained focused on building a high growth, sustainably profitable business domestically. Through this transaction, we would extend our market presence in the UK and sustain high levels of growth given the considerable opportunity in this market.”
Niklas Östberg, chief executive of Delivery Hero, said: “The sale of Hungryhouse to Just Eat rationalizes our global footprint, and we remain focused on operating market leading brands, globally. Proceeds from this sale will allow us to pursue further global growth and profitability opportunities, as we have consistently and successfully done in recent years. We also want to thank the entire Hungryhouse team this transaction reflects their amazing achievements within the Delivery Hero Group since 2011.”
Just Eat said that, with expected revenue of CAD$23.5 million for the current year ending December 2016, SkipTheDishes is one of Canada’s largest online food delivery marketplaces and has developed a technologically-advanced delivery platform focused on lower density metropolitan and suburban areas, which are key features of the Canadian market.
It has a selection of more than 2,900 unique restaurants and 350,000 active customers. SkipTheDishes is currently experiencing strong top line growth, with orders for the 10 months to October 2016 of 1.6 million, representing year on year growth of 186 per cent.
Buttress said: “The acquisition of SkipTheDishes will materially strengthen Just Eat’s number one position in Canada. Canada is a phenomenally exciting country for online food delivery, with significant runway for growth and a clear opportunity to drive channel shift. SkipTheDishes’ outstanding team, technological knowhow and operational excellence has enabled it to develop a business model well-suited to Canada’s unique market conditions. It will complement our existing operations so that Just Eat is best-placed to address this fast growing market.”
