(Alliance News) - A shareholder in Just Eat PLC said on Friday a potential UK competition probe into the firm's merger with Takeaway.com NV is "shocking".
Cat Rock Capital Management LP owns an approximate 3% stake in Just Eat, and also holds around 6% of Takeaway.com.
Just under a year ago, Cat Rock had called on Just Eat to begin merger talks with "industry peers", having welcomed the departure of former Just Eat Chief Executive Peter Plumb shortly before, criticising the appointment of what it called an industry outsider.
The UK Competition & Markets Authority on Friday confirmed it will be looking into whether the combination would lessen competition in the UK takeaway platform sector.
"It is shocking the CMA would investigate the Just Eat merger with Takeaway.com. Takeaway.com has no UK operations, exited its minor business there over three years ago, and has stated that it had no intention to enter the UK market before the Just Eat merger," said Cat Rock founder & Managing Partner Alex Captain.
"The CMA's investigation seems to draw a false equivalence between Takeaway.com's merger with Just Eat and Amazon's investment in Deliveroo. Amazon has a large UK business with millions of customers that it could leverage to re-enter the UK online food delivery market and increase competition."
"Takeaway.com has no such UK presence, customer base, or brand name. It is patently absurd to compare Takeaway.com with Amazon when evaluating the outlook for future competition," Captain continued.
Captain said blocking the merger would impair the ability of a UK company to compete against global rivals.
"The CMA has had an opportunity to review the Just Eat and Takeaway.com merger for almost six months since it was first announced in early August 2019. We hope that any review that starts today, when the combined company's shares are meant to begin trading, would be conducted quickly and fairly," he added.
Just Eat and Takeaway.com had originally envisaged the new, enlarged company to start trading in London on Monday next week, and the name was to be changed to Just Eat Takeaway.com NV Friday this week.
However, due to the CMA move the timetable has been delayed by a week and the new company will be renamed on January 31 and start trading February 3.
Takeaway.com won the bidding war for Just Eat earlier in January, in a deal worth 916 pence per Just Eat share. South African media and internet investor Prosus NV had offered 800p.
Just Eat shares were 3.6% lower on Friday morning in London at 848.80p each.
By George Collard; georgecollard@alliancenews.com
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