Shareholder slams Just Eat and dubs it the worst performing online food firm in the world after shares tumble 30%
- Just Eat shares are down 30% across the year to the same level as two years ago
- Investor Cat Rock has slammed the firm and called for a radical shake-up
- The 2% shareholder is calling on the board to sell of non-core assets
A shareholder in Just Eat has lashed out at the food delivery firm today, dubbing it the ‘worst-performing public equity in online food delivery’ as it called for a radical overhaul.
Cat Rock Capital, which has a 2 per cent stake in the firm, issued a savage plea to Just Eat’s board to ‘address key issues’ and sell off non-core assets, including its interest in iFood business in Brazil and other non-European businesses.
The US investment firm urged Just Eat to devise a three-year financial plan, or else consider ‘strategic alternatives for the business’.
An investor said Just Eat was the ‘worst-performing public equity in online food delivery’
It comes after a torrid year for the firm’s shares, which have tumbled almost 30 per cent in 2018 to trade near the same price as two years ago – despite 100 per cent sales growth over the period.
Indeed, Just Eat has recently been demoted from the FTSE 100 index.
In a letter to the Just Eat board, Cat Rock called for more-demanding long-term profit targets, to properly align executive pay with performance and for the group to sell off non-core assets.
Cat Rock founder and managing partner Alex Captain said: ‘Shareholder frustration with management’s lack of accountability for delivering on this potential continues to damage Just Eat’s value and performance.
The one-year chart from This is Money shows how Just Eat shares have fallen in the last year
‘As we have discussed with the board, we believe the first step toward addressing this problem is clear: it must urgently lay out a three-year plan commensurate with Just Eat’s potential and link management’s remuneration directly to the achievement of that plan, aligning their interests with those of shareholders.’
Captain argued that the sale of Just Eat’s minority stake in iFood could generate as much as £650million.
Just Eat is grappling to keep pace with rivals Deliveroo and Uber, which have muscled in on its territory of late. It was recently knocked by speculation that Uber is in early talks to buy Deliveroo – a move that would create an almighty competitor for the food firm.
‘Just Eat’s shareholders have been very patient, but online food delivery is a rapidly evolving sector. Further delays in planning and decision-making will only continue to destroy shareholder value,’ Captain added.
A Just Eat Group spokesman insisted that the firm has a ‘clear strategy’ in place to deliver long-term value for shareholders.
He said: ‘As you would expect, the board engages closely with shareholders to ensure management have an appropriate long-term incentive programme aligned to the exciting and unique growth opportunities of the Just Eat group.’
Shares in Just Eat were unmoved in early trading at 578p.