Activist critic urges Just Eat investors to fire board: Cat Rock Capital accuses bosses of destroying £13.5bn of value
Just Eat Takeaway has come under renewed attack from activist investors that are demanding a boardroom shake-up.
Bosses at the food delivery company were accused of destroying £13.5billion of value in the business by US-based fund manager Cat Rock Capital.
Cat Rock, the second largest shareholder in Just Eat behind founder Jitse Groen with a near-7 per cent stake, said this has led to a ‘complete loss of trust’ among shareholders.
Cat Rock Capital said Just Eat had ‘torpedoed’ its share price with misleading profit forecasts ahead of the Grubhub takeover in 2020
A long-term critic of Just Eat, the investor is urging fellow shareholders to vote against the re-election of finance chief Brent Wissink.
Cat Rock also wants shareholders to oppose the re-election of the supervisory board at Just Eat’s general meeting next week.
In a letter to shareholders, it said it would abstain on a vote to re-elect Groen, who is the chief executive.
Cat Rock said a new finance boss can ‘restore credibility’ with investors.
The letter comes a week after Just Eat said it will look to sell its US business Grubhub, which it bought less than two years ago for £5.8billion, in an apparent bow to Cat Rock’s demands.
Cat Rock had called the takeover a ‘mistake’ and urged Just Eat to re-focus on its European business.
The announcement of a potential sale came alongside a disappointing trading update in which Just Eat warned it expected growth in the second quarter of the year to ‘remain challenging’ and cut its full-year forecasts.
It reported a 1 per cent year-on-year drop in orders to 264.1million in the first quarter of 2022 as it struggled to beat its lockdown-boosted numbers.
Cat Rock said yesterday Just Eat had ‘torpedoed’ its share price with misleading profit forecasts ahead of the Grubhub takeover in 2020.
The takeaway business has since issued two profit warnings and Just Eat shares are down almost 75 per cent in the last 12 months.
Just Eat is Cat Rock’s only food delivery investment and founder and managing partner Alex Captain said his firm is ‘deeply committed’ to its long-term success.
The delivery business was formed in 2020 through a £9billion merger between Just Eat and Dutch rival Takeaway.com.
It is listed in London and on Amsterdam’s Euronext exchange. Cat Rock described Just Eat’s share price performance as ‘terrible’.
Captain said: ‘Just Eat shareholders suffered this massive destruction of equity value despite the company growing by 97 per cent organically and maintaining clear market leadership across many of the world’s largest economies.’
Just Eat said a boardroom shake-up would be ‘value destructive and destabilising’.