Competition in Australian online food delivery space heats up as UK giant Just Eat agrees to acquire Menulog for $865 million

UK online food delivery startup Just Eat has agreed to acquire Australian startup Menulog for a reported AUD$865 million. The deal, which is subject to approval from the Foreign Investment Review Board, comes three months after Menulog acquired Eat Now. The merger brought the company’s client base up to 5500 restaurants and 1.4 million active users across Australia and New Zealand. According to TechCrunch, Menulog had a revenue of $26 million with a profit of $2.34 million in the year to March 31, which translates to a profit of $425 from each restaurant. Dan Katz, Menulog’s CEO, said in a statement that he is excited about the prospect of Menulog becoming part of Just Eat, which has been a “real inspiration” for the company. “This proposed acquisition will allow Menulog to benefit from Just Eat’s experience and know-how, particularly in digital marketing, and enhance our customer service model to drive further growth and efficiencies across the business,” Katz said. David Buttress, CEO of Just Eat, added that the acquisition is consistent with the growth the company set out to achieve after its IPO last year. The company has been buying up over the past few months, having recently expanded into Mexico, Spain, France, and Canada through acquisitions. Online food delivery has become a hot space over the last year or so. Germany’s Rocket Internet, one of Just Eat’s biggest competitors, is similarly looking to own the global food delivery space by acquiring smaller startups around the world. As well as acquiring a 30 percent stake in Berlin-based Delivery Hero for $586 million earlier this year, the company has made a number of other acquisitions across Europe, Latin America, and Southeast Asia. Having identified food and groceries as “the next frontier of ecommerce,” the company also created the Global Online Takeaway Group to represent its food-related startups, which span 39 countries. Just last week, Delivery Hero acquired Turkish company Yemeksepeti for $589 million. Indian restaurant discovery service Zomato, which has a presence in 22 countries including Australia, is also set to put up some competition. The company began testing a food ordering and delivery service in Delhi in April.

Image: Just Eat CEO David Buttress. Credit: Eat Out Magazine.