Prosus will reduce its shareholding in Delivery Hero from nearly 28pc to a ‘single digit percentage’, it said.
The European Commission has approved the €4.1bn acquisition of Just Eat Takeaway by tech investor Prosus under the condition that it “significantly reduce” its shareholding in Delivery Hero.
Just Eat Takeaway and Delivery Hero are competing food delivery services operating in several EU countries. Both of them offer services in Austria, Bulgaria, Italy, Poland and Spain. Together, they are the largest players in this sector in Europe.
Prosus holds a 27.4pc stake in Delivery Hero, which caused concerns when it announced its plan to acquire Just Eat Takeaway in February. The Commission was concerned that the deal would lead to less competition and a higher likelihood of coordination between the two companies, which could lead to higher prices.
As a remedy, Naspers, Prosus’ parent company, has agreed to reduce its shareholding in Delivery Hero to a “single digit percentage” within the next 12 months.
Naspers has also committed not to exercise the voting rights it has with its remaining shares in the company and to not increase its equity in the company above a certain threshold for a “specified considerable time”.
“We had concerns that the acquisition of Just Eat Takeaway.com by Naspers could allow the parties to coordinate their behaviour in the food delivery market, reducing competition and consumers’ choice,” said Teresa Ribera, the EU’s executive vice-president for clean, just and competitive transition.
“Today’s binding commitments preserve both competition and consumer choice when ordering food at home. This decision also sends a clear warning to an industry with recent antitrust issues, we won’t tolerate any anticompetitive behaviour that may harm consumers.”
Fabricio Bloisi, Prosus’ CEO said, “We’re thrilled by the European Commission’s swift approval of our acquisition of [Just Eat Takeaway]. This milestone marks a bold investment in Europe’s AI future and strengthens our commitment to the continent.”
The company plans to brings its AI solutions to Just Eat Takeaway’s European operations.
Prosus has invested more than $10bn in the food delivery business worldwide. The company is the full owner of Latin America’s iFood and holds an approximate 4pc stake in China’s Meituan – “the world’s largest food delivery business”.
In 2019, Prosus tried to acquire Just Eat before it had merged with Takeaway.com. However, that offer was quick to be rejected.
Last November, the company sold its US arm Grubhub to New York-based Wonder Group for $650m, just four years after purchasing it for $7.3bn in 2020 when demand for contactless food deliveries was high due to pandemic restrictions.
While, this June, the European Commission fined Germany-headquartered Delivery Hero and Spanish delivery start-up Glovo a total of €329m for participating in a “cartel” in the online food delivery sector. The Commission found that the two companies exchanged commercially sensitive information and allocated geographic markets, reducing competition and the choice for consumers.
Don’t miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic’s digest of need-to-know sci-tech news.