Just Eat gobbles up Spanish competition

JUST EAT GOBBLES UP SPANISH COMPETITION

British corporation Just Eat has swallowed up Spanish home delivery food service La Nevera Roja, strengthening the group’s leading market share in Spain.

Although no official figures were released when the news broke, it is estimated that Just Eat may have paid over €30 Million for Spanish operator La Nevera Roja.

 

JUST EAT KEEPS EATING UP COMPETITORS

This deal which acquires 100% of La Nevera Roja follows a string of acquisitions of several businesses owned by the German startup incubator Rocket Internet. As a result, Just Eat has acquired four brands with presence in several European and American countries for a total investment of €125 Million.  The deal has come after many Spanish restaurants decided to offer fully prepared restaurant meals ordered online and delivered to homes as a slightly cheaper alternative to eating out, in response to previously tighter economic times. This food service is expected to grow as Spain´s economy continues to recover.

It is understood that Rocket Internet invested heavily in the home delivery food sector without monetizing their investment, before making the decision to sell to their competitor Just Eat. The deal includes the purchase of all shares in Italian PizzaBo, Hello Food Mexico and Hello Food Brazil. Total market size in those countries is estimated to be over €10 Billion.

 

FIERCE COMPETITION LED TO ACQUISITION

Prior to the acquisition, both companies had been using guerrilla tactics to push up their market share, removing and replacing each other´s attention grabbing window stickers from the restaurants, and creating clashes between rival sales staff and business owners.

Just Eat already held leadership position in Spain, which has now been strengthened by the purchase of La Nevera Roja. The acquisition deal is expected to be approved by the National Markets and Competition Commission (known as CNMC in Spanish), during 2016.

If you wish to receive more information on investment and legal services in Spain, please feel free to contact corporate law firm Argali Abogados.

 

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