While Just Eat (LON:JE) shareholder Cat Rock wants the takeaway service to merge with a rival, AJ Bell’s Russ Mould reckons this is ‘unlikely to be palatable’ to the London-listed group’s management, Citywire reports. The comments came after the investor, which holds less than two percent in Just Eat, urged the company to start merger discussions, arguing that it would benefit from a deal rather than relying on a new chief executive officer.
Just Eat’s share price soared, gaining 3.81 percent to close at 730.80p. This morning, the shares have fallen into the red, having given up 0.52 percent to 727.00p as of 08:10 GMT.
AJ Bell weighs in on comments
Citywire quoted AJ Bell analyst Russ Mould as commenting that Cat Rock’s merger plans were “unlikely to be palatable to the current management given it effectively calls for them to be out of a job”. The analyst further reckons that that the investor’s 1.7-percent stake in the takeaway service “does not carry much weight on its own and it will need to garner support from other major shareholders if it wants to force Just Eat’s hand”.
“In the unlikely event of turkeys voting for Christmas and the board acquiescing to [merger] demands, it remains to be seen just what leverage Cat Rock has,” Mould pointed out.
Just Eat responds
The Guardian quoted a Just Eat spokesperson as saying that the company takes “communications with all our shareholders extremely seriously”.
“As announced previously, we are carrying out a thorough CEO appointment process and we will update the market as appropriate,” the spokesperson added.
Just Eat is scheduled to update investors on its full-year performance on March 6.
As of 08:18 GMT, Tuesday, 12 February, Just Eat PLC share price is 730.80p.