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Just Eat activist tells boss to end Twitter wars with rivals

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Jitse Groeon
Jitse Groeon

One of Just Eat Takeaway’s biggest shareholders has told its boss to stop engaging in Twitter wars with rivals and open itself up to a possible takeover from well-funded rivals.

Alex Captain, the founder of activist investor Cat Rock Capital, said the food delivery firm’s chief executive, Jitse Groen, needed to stop his outbursts on social media in response to comments from rival bosses.

“The response should not happen on Twitter,” Mr Captain said. “It should happen on a credible forum with the facts, data, and analysis that the company has at its disposal.”

Mr Groen has previously used social media to publicly rebuke rivals, such as Uber's Dara Khosrowshahi.

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His call comes as Cat Rock, which is Just Eat’s fourth-largest shareholder with a 4.7pc stake, launched a scathing attack on the company, urging it to sell non-core businesses and consider merging with a larger rival.

Cat Rock criticised the FTSE 100 firm for repeatedly missing its profit targets. Just Eat had forecast €400m (£342m) in adjusted profits in August last year, but has now slashed that to a predicted loss of €350m.

It also called out confusing messaging from Mr Groen, who has attacked grocery delivery companies for making heavy losses before deciding that Just Eat should also invest in convenience store takeaways itself.

Mr Captain said: “They have let the news on investment levels drip out over the past year instead of ‘biting the bullet’ by explaining the full cost up-front and presenting the associated benefits.”

In a presentation to investors, Cat Rock said Just Eat was “massively undervalued” with a market cap of just over €15bn. Its shares have underperformed against rivals, such as Doordash, which is worth $60bn.

Just Eat shares have fallen 30pc this year, despite the boost to food delivery companies from lockdowns as people ordered more takeaways. They rose 3.5pc in Amsterdam on Tuesday.

Cat Rock said the decline had left Just Eat vulnerable to a low-ball offer despite its rapid revenue growth and claimed its assets, such as Grubhub and iFood, could be worth more on their own.

Just Eat has already had a €2.3bn offer for iFood, its Brazilian business jointly owned with Prosus. It rejected the bid but is still looking for a buyer.

Cat Rock also said Just Eat should be open to “strategic combinations with other global players”. Its report named nine firms including Doordash, Amazon, Uber, Japan’s SoftBank and China’s Alibaba and Meituan as potential buyers.

The activist investor was one of the big winners of Dutch firm’s merger with Just Eat in 2020, a £6bn deal, as a top shareholder in both companies.

Food delivery investors believe the market remains ripe for further mergers between the world’s biggest takeaway players.

Tiger Global, a US fund with assets of more than $65bn under management where Mr Captain was previously a partner, recently revealed a stake of 4.4pc in Just Eat. It is also a shareholder in Doordash and Uber.

It is understood that Cat Rock remains in regular contact with Just Eat and remains supportive of Mr Groen.

A Just Eat spokesman said: “Just Eat has a regular dialogue with all its shareholders and we take all their views very seriously. As announced previously, we will be hosting a capital markets day in October to provide the market with increased visibility on how we will capitalise on the exciting, long-term growth opportunities that we have across our business.”

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