Whatâs Going On Here?Food delivery giant Just Eat Takeaway announced a new partnership with Amazon on Wednesday. What Does This Mean?The pandemic brought out the best in the food delivery industry, and Just Eat was positively heady with the success of the moment: it bought US company Grubhub for $7.3 billion in 2020 â a move that finally gave it a foothold Stateside. But with restaurants reopening left, right, and center, that success has evaporated almost as quickly as it arrived. Investors, then, have been putting Just Eat under pressure to sell the offshoot, and itâs been giving the idea some serious thought.
At the same time, though, the companyâs been thinking about how to turn things around. Cue a new deal with Amazon thatâll offer US Prime users a one-year membership to Grubhub, which analysts think could help bring in new customers and boost the serviceâs standing. The solution seems to work for investors: they sent Just Eatâs shares up 20% â their biggest jump in nearly four years. Why Should I Care?Zooming in: Whoa, dĂ©jĂ vu.
If this all feels familiar, itâs because Amazon launched its own restaurant delivery business back in 2015, before shuttering the segment in 2019 when it failed to establish itself as a key player. This deal is arguably a safer bet: Amazon will receive âwarrantsâ â stock options, essentially â that represent a 2% stake in Grubhub, and it could increase that ownership to 15% if it fulfills certain performance conditions, like bringing enough new customers through Grubhubâs door.
Zooming out: Amazon goes green.
Amazon is changing the way it delivers parcels too, announcing this week that itâll start delivering packages by electric bike and on foot for the first time in the UK. Itâs all part of its goal to make half its shipments net-zero by 2030, and 100% by 2040. | 