Online takeaway site Just Eat (JE.) says its acquisition of unlisted Hungryhouse has been provisionally cleared by the Competition and Markets Authority (CMA). If it goes through Investec expects the deal to deliver increased earnings next year.

The CMA's provisional conclusion is the takeover of Hungryhouse will not lessen competition with a final decision expected next month.

Investec analyst David Amiras is confident the deal will complete and boost earnings before interest, tax, depreciation and amortisation (EBITDA) by 7% in the year to 31 December 2018.

‘This suggests EBITDA forecasts rising from £211m to £226m and implies an EBITDA contribution from Hungryhouse of £15m,’ says Amiras.

He believes the takeover of Hungryhouse will bolster Just Eat’s presence in the UK and potentially drive greater economies of scale.


Canaccord Genuity’s Nigel Parson says the CMA is not concerned about competition as Hungryhouse is a weak competitor with 9,000 out of its 10,000 restaurants also available through Just Eat.

Other rivals such as Deliveroo, UberEats and Amazon are likely to be more effective competition for Just Eat and the CMA recognises that customers order food through different means, says Parsons.

He is optimistic that Just Eat can make a profit of £14m from Hungryhouse’s £28m in sales last year. This would be an impressive turnaround considering Hungryhouse suffered a loss of £12m in 2016.

Issue Date: 12 Oct 2017