Home Business NewsBusiness Markets dip and Just Eat mulls Grubhub sale

Markets dip and Just Eat mulls Grubhub sale

by LLB Reporter
20th Apr 22 9:54 am

The markets seem to be stuck in a bit of a holding pattern. They’ve absorbed the shock of Ukrainian conflict and seemingly shrugged it off, while also reacting calmly to an escalating cost of living crisis and new Covid disruption in China.

It feels like something will have to give at some stage but when that might be and what the catalyst could be remains to be seen.

The US offered some solace to investors yesterday thanks to some positive quarterly numbers. That changed after market hours as Netflix served up a shocker which had investors switching off from the shares in their droves.

“Shareholders in Just Eat reacted positively to a plan to potentially sell its US platform Grubhub. Just Eat shares have struggled for months as it has lost customers gained during the pandemic as consumer habits shift back to dining out rather than booking a takeaway,” said AJ Bell’s Russ Mould.

“Key to success in this highly competitive market is scale, however selling Grubhub could give Just Eat Takeaway the resources necessary to dominate in Europe.

“The price tag for any divestment will be closely watched and could embarrass current management given Grubhub was purchased for more than $7 billion just last June.

“However, sparing management’s blushes should not be the priority and if this is the right decision for the future of the business then it seems logical for Just Eat to press ahead with a sale.

“Mining outfit Rio Tinto had a disappointing first three months of the year as a lack of labour and supply chain problems hit shipments of iron ore.

“The company also gave the market no doubt on the scale of the challenges it faces amid Chinese lockdowns hitting demand and the war in Ukraine.

“With this kind of backdrop Rio really needs to get its act together operationally. It can’t afford to add to its external problems by getting things wrong internally.”

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