Prosus has sold a 5% interest in Delivery Hero to Aspex Management for €335m (about R6.5bn) as part of its commitment to European regulatory authorities to significantly reduce its shareholding in the German online takeout business.
In August last year, the European Commission approved Prosus’ acquisition of Just Eat Takeaway.com (Jet), subject to commitments by the Amsterdam-based company to significantly reduce its shareholding in Delivery Hero.
Earlier this year Prosus sold a 4.5% stake in Delivery Hero to Uber for about €270m. It sold about 13.58-million shares in Delivery Hero at €20 per share.
The latest sale to Aspex of about 15.19-million shares has been agreed at €22 per share, representing a 10% premium to the closing share price and a 22% premium to the 30-day volume-weighted average price of Delivery Hero shares as of May 8.
Today’s transaction represents a further step towards fulfilling the commitments to the European Commission, Prosus said.
The transactions come at a time when the European Commission is reported by the Financial Times to be mulling a major overhaul of its rules around merger and competition laws to foster “European champions” capable of competing with US and Chinese rivals.
Amid criticism that strict competition rules and overregulation have stifled innovation on the continent, this move signals a change in tack by the EU.
Business Day reported previously that Naspers-Prosus boss Fabricio Bloisi has been critical of the effect of EU regulations on the ease of doing business.
Since taking the helm at the JSE’s largest technology group, Bloisi has sharpened the group’s focus on Europe, betting big on creating large tech businesses to rival those in the US and compete with its large Asian investments.
During this year’s World Economic Forum, Bloisi was blunt about Europe’s status compared with the US and China, telling CNBC that the continent has already missed previous cycles and is repeating those mistakes.
He said Europe needed to have “real big companies” to compete globally, but too much focus was on preventing consolidation.
“We have to change that to create really big companies in Europe,” he said.
Naspers completed its acquisition of Jet through Prosus in October last year when the offer became unconditional.
It was Prosus’ second swing at acquiring Europe’s biggest meal delivery company for €4.1bn, making it its largest investment yet.
The technology investor gained EU antitrust approval in August for its bid after agreeing to sell down its stake in Delivery Hero.
Naspers offered to reduce its 27.4% stake in Delivery Hero to below a specified low percentage within 12 months.
The Jet deal made Prosus the world’s fourth-largest food delivery company after Meituan, DoorDash and Uber, according to ING analysts.
In 2020, Naspers failed to secure a high-profile bid for Jet, losing out to Takeaway.com, which paid $8bn.
Prosus’ £5bn bid, about R98bn at the time, was seen as a sign of an ambitious strategy to build a bigger food delivery business to take on Silicon Valley giant Uber Eats and Amazon-backed Deliveroo.
With Mudiwa Gavaza
Business Day
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