Online food delivery business Just Eat PLC (LON:JE.) has been splashing the cash on Thursday morning, snapping up its rivals hungryhouse and SkipTheDishes, a Canadian firm.
Just Eat will shell out an initial £200mln to hungryhouse owner Delivery Hero, with a further £40mln also payable should the business hit certain performance targets.
Hungryhouse is one of Just Eat’s main competitors in the UK. Although it posted a loss before tax of £5mln last year, Just Eat expects the acquisition to be earnings per share-accretive in the first full year of ownership.
“Through this transaction, we would extend our market presence in the UK and sustain high levels of growth given the considerable opportunity in this market,” said Just Eat chief executive David Buttress.
The London-listed firm will also expand its international presence after agreeing to spend a further £66.1mln to buy out Canadian online food delivery group SkipTheDishes.
Like the hungryhouse deal, a further performance-related payment of £54.1mln could also be due in the future.
Buttress said the acquisition would “materially strengthen” its number one position Canada as it looks to become “the clear market leader” in the country.
“Canada is a phenomenally exciting country for online food delivery, with significant runway for growth and a clear opportunity to drive channel shift,” he added.
SkipTheDishes has 350,000 active users and almost 3,000 restaurants on its platform.
Revenue for the current year to December is expected to come in at C$23.5mln.
It’s been a good year for Just Eat shareholders with the stock reaching record highs over the summer after it told investors orders had gone up by 40%.
Just Eat shares were up 3% to 614p in early trading.