Just Eat rebuffed a higher takeover offer from Prosus on Tuesday claiming it “significantly undervalued” the U.K food delivery company, and said it continued to support a rival all-share offer from Takeaway.com TKWY, -2.60%
Prosus PRX, -1.43%, the Amsterdam-listed investment vehicle of South Africa’s Naspers NPN, -2.16%, had increased its all-cash offer by 30 pence a share to 740 pence a share on Monday, following “extensive discussions” with Just Eat JE, -0.05% investors. The new bid valued Just Eat at £5.1 billion.
However, Just Eat said the increased offer from Prosus represented a discount of 5% to its closing share price on Friday, the last business day before the new bid.
In a statement, Just Eat said: “The board of Just Eat continues to believe the Prosus offer fails to reflect appropriately the quality of Just Eat and its attractive assets and prospects, the benefits of first-mover advantage in a consolidating sector, and, on the basis of its own analysis, the future upside available to Just Eat shareholders through remaining invested in Just Eat and the Takeaway.com combination.”
Shares in Just Eat were slightly higher at 781.32 pence in London trading on Tuesday. Takeaway shares were down 2.19% at €82.80. Prosus shares were down 1.08% at €59.40 on Tuesday morning.
Just Eat and Takeaway announced plans to merge in July in a £8.2 billion deal to create the world’s biggest online food-delivery company outside China and a major rival to Uber Eats.
At the time, Takeaway’s offer valued Just Eat at 731 pence a share. However, Takeaway’s shares have since fallen, reducing the value of its bid which was worth 685 pence a share on Tuesday.
On Tuesday, activist investor Cat Rock Capital, which owns 3% of Just Eat’s stock released a public presentation outlining its research on the proposed merger between Just Eat and Takeaway. Cat Rock, which also owns 4% of Takeaway said Prosus would have to offer around 925 pence a share to succeed in its bid.
Prosus has also lowered the threshold for shareholders to accept the deal from 75% to 50% plus one Just Eat share. Shareholders have until 1 pm on Dec. 27 to decide whether to accept the bid.