Global technology investor Prosus (PROSF) has promised an AI takeaway experience for customers after snapping up food delivery group Just Eat Takeaway in a $4.1 billion deal.
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AI to Boost Customer and Driver Experience
The all-cash offer has been given the green light by the Amsterdam-listed Just Eat Takeaway.com’s board and if approved by shareholders will create the fourth largest food delivery group in the world. The offer price represents a 22% premium to Just Eat Takeaway.com’s highest share price over the last three months. Prosus said the deal would create a “European tech champion” with a promise to accelerate investment in Just Eat’s growth across food, groceries and fintech. It also means extending its “AI capabilities to improve the customer and driver experience, boost service reliability and optimize logistics.”
Prosus has already shown huge appetite for the food delivery sector. It owns iFood, Latin America’s leading food delivery platform, has a 28% stake in Delivery Hero, and an approximate 4% stake in Meituan, the world’s largest food delivery business. It also holds a 25% stake in Swiggy, a leading food and grocery delivery platform in India, which recently completed a successful IPO in India.
Global Appetite for Food Delivery
Just Eat Takeaway.com operates in 17 international markets and has around 61 million customers. Its shares soared during the pandemic as people dined in during lockdown but have struggled since. In 2021, it also acquired U.S. delivery platform Grubhub, which it then sold last November for $650 million, far less than the $7.3 billion it paid originally. Despite these hiccups there is still huge demand from people wanting to order food and groceries from home. The global online food delivery industry was valued at $242 billion in 2023 and is expected to reach $746 billion by 2033.
Shares in U.S. food delivery group DoorDash (DASH) edged up slightly on the news with Uber Technologies (UBER), owner of Uber Eats down. This means investors are weighing up the clear investor demand for food delivery businesses but perhaps concerned over the deal valuation and any competition concerns.
Is DASH a Good Stock to Buy?
On TipRanks, DASH has a Strong Buy consensus based on 22 Buy and 7 Hold ratings. Its highest price target is $245. DASH stock’s consensus price target is $224.33 implying an 12.20% upside.
