Just Eat Top Investor, Proxy Advisers Urge Opposition at AGM

(Bloomberg) -- Just Eat Takeaway.com NV’s board and management will face opposition at the food delivery company’s upcoming annual general meeting, with the firm’s largest investor and key proxy advisers recommending votes against key members of the company’s leadership.

Activist investor Cat Rock Capital Management LP, which owns about 6.9% of Just Eat, urged shareholders to vote against the delivery company’s Chief Financial Officer Brent Wissink and supervisory board at next week’s AGM citing a “complete loss of trust” in management. 

Major shareholder proxy services Institutional Shareholder Services Inc. and Glass Lewis have also recommended voting against the re-election of supervisory board chairman Adriaan Nuhn over the board’s gender diversity, and environmental and social governance, respectively. 

The new calls to oust top leaders increase pressure on the company and join those from investor Lucerne Capital Management, which said in early April it planned to vote against the re-appointment of the food delivery company’s CFO and supervisory board at the annual general meeting in early May.

Amsterdam-based Just Eat Takeaway has come under pressure from investors over the past year, with its shares down roughly 70% as investors push the company to sell or spin-off its recently acquired U.S. unit Grubhub. Just Eat Takeaway said last week that it’s exploring a sale for Grubhub, less than a year after completing an acquisition for it worth $7.3 billion. 

A Just Eat Takeaway representative said that “management shares investor disappointment in the recent share price performance of the Company.” The spokeswoman added that the company “believe that Cat Rock’s proposal to remove key supervisory and management Board members, would be both destructive and destabilizing.”

Investor Letter

In a letter Monday morning, Cat Rock Capital’s founder and managing partner Alex Captain accused Just Eat Takeaway’s management of providing a misleading outlook to investors ahead of two Grubhub shareholder votes that led to “two massive profit downgrades in 2021 and shattering investor trust.”

The investor firm said the food delivery company made a capital allocation mistake when it decided to buy Grubhub, adding that the deal alone can not explain the loss of 16 billion euros ($17.2 billion) in equity that has been lost in less than two years.

“JET needs a new CFO to restore credibility with the capital markets and a new Supervisory Board to quickly refocus the business on Europe, use the proceeds of divestitures to strengthen JET’s capitalization, and actively evaluate other strategic options,” Captain said in a letter to shareholders.

Shareholders including the California State Teachers’ Retirement System and California Public Employees’ Retirement System have disclosed they plan to vote against Nuhn, according to data compiled by Bloomberg. Representatives for both funds declined to comment on their rationale.

In its report, ISS said that voting against Nuhn was warranted because “the level of gender diversity on the board is insufficient, not aligned with market expectations.” 

Just Eat Takeaway announced in January that board member Gwyn Burr will step down after the shareholder meeting, leaving a board that is 17% female, according to ISS. 

A Bloomberg Data analysis of companies that have disclosed gender per board member found that about 38% of directorships for Europe’s Stoxx 600 companies are held by women. In the IT sector, that rises to about 40%.

Supervisory Board

The Just Eat Takeaway representative added that the supervisory board -- which currently has seven members -- is looking for a female candidate to fill Burr’s position, and have decided to nominate an eighth member who will be female in the course of this year. 

“The additional appointment will cause three out of eight SB members to be female, therefore ensuring compliance with the guidance to have at least one third of the SB consist of female members,” the representative said.

Glass Lewis separately said in its report that it was against Nuhn’s re-appointment because “while we note that the Company has a disclosed point of accountability for environmental and social issues it has not, to the best of our knowledge, provided explicit disclosure concerning the supervisory board’s role in overseeing environmental and social risk.”

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