Takeaway.com's £ 6.2 billion takeover of the rival food delivery company Just Eat was delayed after an initial probe was launched into the deal by the UK antitrust regulator.
On Friday, the Competition and Markets Authority (CMA) said it had launched a review of the two firms ' merger, which will look into whether the agreement could lead to a "substantial reduction in competition" in the UK. The CMA says it's encouraging interested parties to comment on the deal until Feb. 6.
Takeaway.com said it was informed on Thursday that the CMA had "reconsidered its position" on the takeover, and believed that an investigation into the merger was now warranted. A further announcement from the firm on Friday said as a result of the investigation Takeaway.com would now delay its proposed all-stock sale by a week.
The CMA review is a blow to the proposed merger of Dutch-based Takeaway.com and UK-based Just Eat, two major players in the fast-growing food distribution market in Europe. Takeaway.com spent months battling off competing offers for Just Eat from Naspers ' little-known tech investment arm, fellow Dutch company Prosus.
It's just come months after the UK. Competition watchdog said it would begin a formal Amazon minority investment inquiry in the UK. Meat start-up Deliveroo. The e-commerce giant led last year's buzzy online takeover app to a $575 million fund-round. Deliveroo is one of the top tech success stories in London, estimated at $2 billion to the north.
Food delivery has proved to be a hot market for investors and one on the verge of rapid consolidation. Uber announced earlier this week that it would sell its Eats service in India to local operator Zomato, taking a minority stake in the company backed by Ant Financial. Uber CEO Dara Khosrowshahi said after the merger that "consolidation has to happen."
Takeaway.com said more than 90 per cent of Just Eat owners agreed to sell their shares. It said on January 31, the combined company will be branded "Just Eat Takeaway.com NV," but will not be listed until Feb. 3 due to its revised business timeline results.
Takeaway.com and Just Eat's shares dropped around 3 percent and 4 percent, respectively, after the CMA's antitrust investigation revealed.
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