Grubhub CEO Matt Maloney on Thursday doubled down on the company’s decision to merge with Just Eat Takeaway rather than work through a deal with Uber.
Uber’s bid to acquire Grubhub would have brought two of the largest food delivery companies in the U.S. together. However, people familiar with the matter told CNBC that talks fell through amid concerns over antitrust scrutiny.
But Maloney said Grubhub liked Just Eat’s offer better.
“The offer [from Just Eat] was dramatically better. It was a much higher offer. It was a mid sixties offer versus a $75 offer. There was no comparison in terms of economics, there was no comparisons in terms of confidence to get the deal done and here we are and we can continue executing our aggressive financial competitive strategy and win,” Maloney told CNBC’s “Squawk Box,” referring to the share price Just Eat and Uber offered.
Still, Grubhub’s ultimate decision to merge with Just Eat confused Uber representatives, according to people familiar with the matter who spoke with CNBC. Uber felt its stock has more upside than shares of Just Eat, making it better currency for Grubhub shareholders, said two of the people. Some Uber representatives also questioned if Grubhub was more attracted to Just Eat’s offer because it would keep current Grubhub executives running the business.
Maloney will join Just Eat’s management board and will lead the combined business in North America. Two Grubhub directors also will join Just Eat’s supervisory board.
“Like ride-sharing, the food delivery industry will need consolidation in order to reach its full potential for consumers and restaurants,” an Uber spokesperson told CNBC on Wednesday. “That doesn’t mean we are interested in doing any deal, at any price, with any player.”
Grubhub and Just Eat Takeaway announced merger terms on Wednesday. Just Eat Takeaway offered 0.67 shares for each Grubhub share, an implied value of $75.15 for each Grubhub share based on June 9′s €98.60 Just Eat Takeaway closing price. Just Eat Takeaway shares fell more than 10% on the news, lowering the offer to about $65.17 per Grubhub share. Uber offered 1.925 shares for each Grubhub share, valuing Grubhub at $67.04 based on Wednesday’s close, according to people familiar with the deal.
Grubhub and Just Eat Takeaway expect their deal to close in the first quarter of 2021.
– CNBC’s Alex Sherman contributed reporting.
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