October 28, 2019 / 7:47 AM / 16 days ago

Investor Cat Rock says Prosus 'undermining' Just Eat sale

AMSTERDAM (Reuters) - Investor Cat Rock Capital on Monday accused internet conglomerate Prosus PRX.AS of undermining the sale process of British food delivery business Just Eat (JE.L), which is the focus of a bidding war in the fast-growing sector.

Signage for Just Eat is seen on the window of a restaurant in London, Britain, August 5, 2019. REUTERS/Toby Melville.

Netherlands-listed Prosus last week made an unsolicited $6.3 billion cash bid to buy Just Eat, which had already agreed to an all-share offer from rival Takeaway.com (TKWY.AS).

Cat Rock said in a statement that the sale of shares in Just Eat undertaken by Delivery Hero of Germany (DHER.DE) “directly and materially harmed” Just Eat shareholders.

Prosus owns a 22.3% stake in Delivery Hero, and the pair are considered “concert” parties. In September, before Prosus’s bid for Just Eat was announced, Delivery Hero began selling down its stake of 8 million shares, or 13% in Takeaway, by 3 million shares.

Cat Rock said that was being done to keep Takeaway’s share price low and make its bid for Just Eat appear unattractive.

“Delivery Hero structured its share sales in a bizarre and uneconomic fashion that seems deliberately intended to depress Takeaway.com’s stock price in the run-up to the shareholder vote on a merger with Just Eat,” Cat Rock said.

Prosus could not immediately be reached for comment.

Takeaway agreed to buy Just Eat in August in a deal that would create one of the biggest food delivery groups outside China, with leadership in Britain, Canada, Germany and the Netherlands.

A slide in Takeaway’s shares, however, has reduced the value of its bid from an original 731 pence a share to 594 pence.

Cat Rock owns roughly 3%, or around 17.7 million shares, of Just Eat, as well as 34 million, or 5.6%, of Takeaway shares.

“We and Just Eat shareholders are happy to consider fair proposals from Prosus,” Cat Rock said.

(This story corrects in paragraph 4 Prosus is trying to buy Just Eat)

Reporting by Anthony Deutsch and Toby Sterling; Editing by Clarence Fernandez

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