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Prosus still chasing food deals, after losing Just Eat battle

‘We continue to look at lots of different options in this space’ – Larry Illg.
Image: Jasper Juinen, Bloomberg

Prosus NV hasn’t lost its appetite for food delivery, even after the e-commerce giant was defeated in a gruelling $8 billion bidding war for U.K. firm Just Eat Plc. NV last week declared victory in the battle for Just Eat, saying investors holding 80.4% of the shares had formally backed its all-stock bid and rejected a cash offer from Prosus. But the Naspers- controlled company has alternative targets to pursue, according to head of ventures and food, Larry Illg.

“We continue to look at lots of different options in this space,” Illg said.

Prosus — spun off by South African parent Naspers in September — has targeted food delivery as a key market for investment as more people opt to order in meals rather than cook. The company also has stakes in Delivery Hero in Germany and India’s Swiggy alongside a controlling stake in iFood in Brazil.

One option for further expansion could even see Amsterdam-based Prosus going back to the negotiating table with Takeaway, which is based in the same city. The new owner of Just Eat has said it will consider selling the British firm’s 33% stake in iFood, in which Prosus is the majority shareholder.

Prosus would consider buying more of the Brazilian firm, though an additional investment would have to make financial sense and won’t be “something that we would do at all costs,” Illg said.

“It’s strictly about the financials because it wouldn’t change anything about how we help manage the business,” he added.

Illg’s comments come as food-delivery companies race to consolidate to withstand fierce competition from firms such as Uber Technologies Inc.’s Uber Eats and myriad other apps. Takeaway’s new combined company, listed in London, will become one of Europe’s largest food-delivery operations after the deal is completed.

Grubhub Inc. last week said it “unequivocally” isn’t running a sale process, denying reports in The Wall Street Journal and New York Post that the U.S. firm is on the auction block. Meanwhile, Inc.’s attempt to purchase a minority stake in British food delivery startup Deliveroo has run into unexpected scrutiny from U.K. antitrust regulators who’ve opened an in-depth investigation into the deal.

Asked about Grubhub or Deliveroo as possible investment targets, Illg declined to comment, but added Prosus isn’t fixated on pursuing deals in a specific location.

“We’re not looking to colour in white spaces on the map. It’s very opportunistic,” he said.

© 2020 Bloomberg L.P.

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