Amazon takes stake in Grubhub, adds food delivery perks for Prime members
Just Eat Takeaway.com, Grubhub’s parent company, continues to explore a sale of the US food delivery platformJust Eat Takeaway.com, Grubhub’s parent company, continues to explore a sale of the US food delivery platform
• Just Eat Takeaway.com, Grubhub’s parent company, continues to explore a sale of the US food delivery platform
Amazon.com Inc (NASDAQ: AMZN) on Wednesday has secured the right to buy a 2% stake in Grubhub, the US subsidiary of Dutch company Just Eat Takeaway.com’s, and will offer no-fee access to the service for a year to US Prime members hoping to boost subscriptions with a renewed push into meal delivery.
The deal was announced ahead of Amazon’s July “Prime Day” and will let the e-commerce giant’s subscription members use Grubhub without delivery fees on orders over $12 in more than 4,000 US cities.
Shares of Just Eat Takeaway jumped almost 16% at 15.86 euros in Amsterdam trading, marking a significant relief for Europe’s largest meals company, whose stock had fallen 70% this year.
The agreement comes as Netherlands-based Just Eat is exploring a sale of Grubhub amid pressure from investors to improve its business.
The Dutch company also said Amazon will be able to increase its total stake to 15% of Grubhub depending on certain performance factors, such as the number of new customers added.
News of the deal sent shares of food delivery platforms lower, with Uber Technologies Inc’s (NYSE: UBER) stock falling more than 4.5% and DoorDash Inc (NYSE: DASH) plunging as much as 9%.
“The value of a Prime membership continues to grow with this offer,” said Jamil Ghani, vice president of Amazon Prime, in a statement.
The e-commerce giant had previously experimented with adding food delivery perks to Prime. In September, it announced a tie-up with European delivery company Deliveroo that gave Prime members in the UK and Ireland access to Deliveroo Plus for one year.
Picture Credit: CNBC
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