Just Eat, Hungryhouse deal hits roadblock - Mobile World Live

Just Eat, Hungryhouse deal hits roadblock

10 MAY 2017

A planned £200 million acquisition of Hungryhouse by fellow food delivery app maker Just Eat faces an in-depth merger investigation unless the company can address the UK Competition and Markets Authority’s (CMA) concerns.

Following an initial investigation into the merger, the regulator found the companies are close competitors because of the similarity of their service and their broad geographical coverage.

In a statement, the CMA explained it is: “concerned that the loss of competition resulting from the Just Eat/Hungryhouse merger may result in worse terms for restaurants using either of the two companies.”

Unless Just Eat is “able to offer undertakings which sufficiently address the CMA’s competition concerns” by 17 May, the deal will be referred for an in-depth phase two investigation by an independent group of CMA panel members.

Just Eat said it is: “committed to demonstrating to the CMA that the market is, and will remain, competitive following completion of the proposed transaction.”

However, the CMA is concerned more recent entrants offering delivery services – such as Deliveroo, UberEATS and Amazon Restaurants – represent less direct competition as they tend to target dine-in restaurants without their own delivery services. They also offer less extensive geographic coverage.

Howard Cartlidge, head of EU and Competition at law company DWF, told The Telegraph: “This is an early, but important, opportunity for the CMA to keep the market open and lay down some ground rules for how it will approach app-based businesses in the future.”

Both Just Eat and Hungryhouse are based in London with the former operating internationally with 14.2 million customers and 64,000 restaurants, and the latter partnering 10,000 restaurants throughout the UK.

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Saleha Riaz

Saleha joined Mobile World Live in October 2014 as a reporter and works across all e-newsletters - creating content, writing blogs and reports as well as conducting feature interviews...More

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