Uber, Just Eat Takeaway CEOs Spar on Twitter Over Tax and Shares
(Bloomberg) -- Uber Technologies Inc.’s plans to expand its food delivery service to Germany in the coming weeks kicked off a spat between the company’s chief executive officer and the head of German market leader Just Eat Takeaway.com NV.
The Dutch company’s CEO Jitse Groen said in a tweet to Uber’s Dara Khosrowshahi that the move was an “interesting way of trying to depress our share price.” Uber’s chief replied that Groen should focus less on short-term stock moves.
Groen shot back to Khosrowshahi: “Start paying taxes, minimum wage and social security premiums before giving a founder advice on how he should run his business.” Representatives for both companies declined to comment on the exchange.
Uber’s move brings a new rival to Germany where Just Eat Takeaway has been dominant since it bought out a competitor’s local business in 2018. The companies have a history of clashing as both try to expand their food-delivery empires globally. Uber faced off with Takeaway in Groen’s ultimately successful bid for Just Eat, which completed last year.
More recently, both companies bid for GrubHub Inc., with the Dutch company again coming out on top after Uber’s bid snagged on price and antitrust concerns. The all-stock deal for GrubHub will mark a major expansion into the U.S. for Just Eat Takeaway and create a major competitor in Uber Eats’s largest market.
Just Eat Takeaway shares fell as much as 5.4% in Amsterdam trading while Uber was up as much as 1.3% at 11:29 a.m. in New York.
In Germany, Uber said it believes there’s strong demand for more food delivery services and said it will start its expansion in Berlin. The company will contract out its delivery riders to third party suppliers, similar to the way its ride-hailing drivers operate, the company said.
The new market could provide an opportunity for Uber to expand into other kinds of delivery services, since Just Eat Takeaway only does restaurant food delivery, Bloomberg Intelligence analyst Mandeep Singh said in a note on Wednesday. Groen said last week that the company was running tests on grocery delivery, but that it would only add the service if it was neutral to gross profit.
“Expansion in Germany could aid take rates if the company can move beyond Uber Eats to offer other kind kinds of delivery services through partnerships with local merchants. While competition from DoorDash has hurt Uber’s share in the U.S., Europe’s sales contribution rose 500 bps to about 20% in 2020.”
-- Mandeep Singh, BI technology analyst
Just Eat Takeaway’s approach to delivery may have left it “exposed” to competitors in Germany, with Uber and smaller delivery rival Wolt announcing plans to expand into the market in the last six months, Jefferies Financial Group analyst Giles Thorne said in a note on Wednesday. Rivals are “evidently reveling in how under-developed delivery is.”
Uber Eats is available in other European markets such as Spain, France, Poland and the U.K. The news was first reported by the Financial Times.
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