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Just Eat's £200m acquisition of Hungryhouse is being investigated

Just Eat's £200m acquisition of Hungryhouse is being investigated
Published by
Business Insider

1m read

19 May 10.51am

Hargreaves Lansdown is not responsible for this article's content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest. Article originally published by Business Insider.

Just Eat's planned purchase of its takeaway delivery rival Hungryhouse will be investigated by the UK's competition authority, because of worries the merger could have a negative impact on restaurants.

Just Eat announced that it wanted to buy Hungryhouse in December for £200 million.

But the UK's Competition and Markets Authority (CMA) is now referring the deal for an "in-depth investigation," because of worries the deal "could lead to worse terms for restaurants using either company."

Just Eat was founded in 2001, went public in 2014, and is now present across 13 markets, according to its site. Hungryhouse is its biggest competitor in the UK.

The regulator gave Just Eat a chance to respond, but the firm did not. Now a panel of CMA members will scrutinise the deal and come to a decision on November 2.

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Specifically, the CMA said last month the merger could mean a "substantial lessening of competition" in the takeaway delivery market, because Just Eat and Hungryhouse were so similar. It found newer businesses like Uber and Deliveroo weren't necessarily "direct competition", because they cover a smaller area, and serve dining-in restaurants rather than takeaways.

There are three possible outcomes of the investigation: the merger is allowed to go ahead; the CMA allows it to go ahead with some conditions; or the CMA blocks the merger.

Just Eat has not responded to a request for comment.

This article was written by Shona Ghosh from Business Insider and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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  • 19 May 10.51am
  • 1m read

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Article originally published by Business Insider. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.

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