Just Eat ally cries foul over ‘dirty tricks’ by hostile bidder’s division
THE £5 billion takeover fight for Just Eat exploded into major acrimony on Monday amid accusations of dirty tricks surrounding the hostile bidder. Just Eat agreed an all-share merger with European rival Takeaway.com in August. Then, last week, South African giant Prosus gatecrashed with a £4.9 billion cash offer. It was rejected.
Today, one of Takeaway’s biggest shareholders accused a Prosus division of manipulating the Takeaway.com share price downwards to damage the value of the agreed deal. The shareholder, Cat Rock Capital, said Prosus’s Delivery Hero division, which owned 22% of Takeaway, had been deliberately selling shares at below the market price to force the bid value down. Cat Rock said Delivery Hero, which “acknowledges it is a concert party with Prosus”, began ditching shares in Takeaway just 11 days before the Prosus bid became public.
It claimed: “Delivery Hero structured its share sales in a bizarre and uneconomic fashion that seems deliberately intended to depress Takeaway.com’s stock price.” Alex Captain of Cat Rock said: “Prosus and its concert parties cannot be allowed to undermine competing bids for Just Eat. The Just Eat board and relevant authorities must take action to restore the integrity of this sale process.” Prosus has a 22% stake in Delivery Hero. Cat Rock has nearly 6% of Takeaway.com. City analysts say the Financial Conduct Authority will have make a judgment whether Delivery Hero’s actions amount to market manipulation. Some in the market were already suspicious.
A note from ABN Amro on October 8 said: “We see Delivery Hero doing strange things [with respect to its Takeaway.com share sales]. The structure and timing of the order appear to be designed to create as much overhang on the Takeaway.com share price as possible… we cannot exclude that it is an expensive attempt to frustrate the deal.” Delivery Hero denied any suggestion of wrongdoing, insisting it was merely keen to divest itself of Takeaway shares. The sale is “in no way related to this event [Prosus’s offer for Just Eat], but is in line with its previously announced divestment strategy and is fully in compliance with all applicable legal and regulatory requirements”. That opens the possibility of legal action.
