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Just Eat Takeaway.com NV on Wednesday said it has partnered with Amazon.com Inc to give Amazon Prime members in the US access to free deliveries on its Grubhub platform.
Shares in Just Eat Takeaway were up 17% to 1,388.00 pence each in London on Wednesday morning. Meanwhile, shares in Amazon closed 3.6% higher at $113.50 each in New York on Tuesday.
Grubhub is an American online food ordering and delivery platform. The Chicago, Illinois-based company agreed to be taken over by Just Eat Takeaway in 2020 for $7.3 billion. The deal was completed a year later.
From Wednesday, Just Eat Takeaway said that Amazon Prime members in the US can sign up for a free, one-year Grubhub membership, and access unlimited free deliveries from restaurants on Grubhub.
In addition to free delivery on eligible orders, Grubhub+ members get access to member-only perks and rewards, the food delivery firm said.
Under the agreement, which renews automatically each year unless terminated by Amazon or Grubhub, Amazon will receive warrants over 2% of Grubhub's shares and an additional 13% conditional on the deal bringing Grubhub enough customers.
Just Eat Takeaway expects the agreement to expand membership to Grubhub+. Further, it anticipates that the deal will have a neutral impact of Grubhub's 2022 earnings, and be earnings accretive from 2023 onwards.
The food delivery firm said that it is still mulling the partial or full sale of Grubhub.
In April, Just Eat Takeaway said it was exploring options for Grubhub. This could involve introducing a ‘strategic partner’ in order to sell a stake, or even all of its holding in Grubhub
Grubhub Chief Executive Adam DeWitt said: ‘I am incredibly excited to announce this collaboration with Amazon that will help Grubhub continue to deliver on our long-standing mission to connect more diners with local restaurants. Amazon has redefined convenience with Prime and we're confident this offering will expose many new diners to the value of Grubhub+ while driving more business to our restaurant partners and drivers.’
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