Recommended bid by Prosus N.V. undervalues Just Eat Takeaway.com N.V.

Temps de lecture : 1 min

Publié le

April 1, 2025

par

BDL Capital Management

PRESS STATEMENT

• The bid price constitutes a 64% discount to fair value

• Risk of conflicting interests

• The views of up to 33% of the minority shareholders are disregarded

PARIS, 2 April 2025 - BDL Capital Management (BDL) - a Paris based asset management company, investing funds from institutional and private clients in European equity markets - has expressed its concerns about the announced bid by Prosus N.V. (Prosus) on Just Eat Takeaway.com N.V. (The Company). As a long term investor in the Company, BDL is concerned about the bid price and the way in which the bid is structured.

Hughes Beuzelin, founder & CEO of BDL states: “We are very concerned about the announced bid. Because of the announced bid price that we consider unfair. Because of the substantial risk that management’s recommendation to agree to the bid may be influenced by the prospect of future management incentives from Prosus. And because of the fact that Prosus and the Company intend to use a squeeze-out mechanism to secure a deal that – due to its structure – can be completed without testing the willingness to accept it of a sufficiently large majority of the shareholder base. We doubt, therefore, whether the agreement and recommendation of the management board and the supervisory board can be considered proper policy of the Company.“

BDL has been investing in Just Eat Takeaway.com N.V. (the Company) since 2021. Currently BDL holds approximately 2,18% (4.55 million shares) of the Company’s share capital. In the joint press release on 24th February, Prosus N.V. (Prosus) and the Company, announced the agreement for an all-cash share deal, whereby Prosus would acquire the Company at a price of EUR 20.30 per share.

Bid price far below fair value

BDL has the opinion that this price offer is far below a reasonable and fair valuation of the Company. Its detailed analysis of public information about the Company, comparables and past transactions shows that a reasonable target price for the Company is in the range of EUR 56.1 per share. The bid price therefore includes a significant discount rather than a premium.

BDL’s estimate of fair value is based on a combination of different valuation methods. BDL has detailed its analysis in a 33-page memo.

Taking the Company’s own guidance of the same date as the public bid, Prosus' bid transaction multiples are lower than realistic multiples observed for transactions, including transactions involving JET, which would value the Company at EUR 62.5 per share (the “observed multiples approach”).

The sustainability of the Company as a standalone entity is unquestioned and potential for strong margin growth remains fully intact. In its FY2024 results simultaneously shared with the bid, the Company reiterated its medium-term target of an EBITDA margin exceeding 5% of GTV (compared to approximately 2% expected for fiscal year 2025).

Taking into account all of the above metrics, detailed analysis by BDL shows that a reasonable target price for the Company on a stand-alone basis is in the range of EUR 45.4 per share. Moreover BDL estimates Prosus can generate synergies (additional value of EUR 7.5 per JET share), consistent with Prosus’ comment of IRR significantly above 20%. Combined with a valuation of synergies, a reasonable target price should be EUR 52.9 per share (the “fundamental DCF approach”).

Combining the observed multiples approach and the fundamental DCF approach would result in a fair value of EUR 56.1 per share, which means the present bid of EUR 20.30 constitutes a 64% discount tofair value.

Risk of conflicting interest in management’s recommendation

BDL understands from the press release that management and supervisory board members have agreed to irrevocable undertakings to tender their 8.1% shares, of which 7,24% is held by the Company’s CEO Jitse Groen (according to public information). BDL is concerned to what extent the prospect of ‘appropriate retention and incentive arrangements’ (as mentioned in the press release) may have influenced management’s willingness to recommend the bid and to agree to tender their shares. This potential conflicting interest jeopardizes the credibility of management’s recommendation.

Bid structure disregards interests of minority shareholders

BDL also objects against the structure of the announced transaction, which gives the Company the ability to squeeze out or disregard up to 33% of the minority shareholders. This threshold exceeds by far the threshold of 5% provided by section 2:359c of the Dutch Civil Code applicable to public bids.

As investors in European equity securities BDL fears that allowing bid-structures that deprive up to 33% of the shareholders of the growth potential of their investment against their will, will make the Dutch equity market very unattractive in comparison with the law and practice in other EU member states.

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