11th Feb 2019 08:47
LONDON (Alliance News) - Just Eat PLC shareholder Cat Rock Capital Management LP has urged the online takeaway company to start merger talks with "industry peers" and not repeat past mistakes by appointing industry outsiders in senior executive roles.
The US hedge fund, which owns around 1.7% stake in Just Eat, said in a letter to the company's board on Monday that a merger with a well-run industry peer would be a far better outcome for shareholders as opposed to relying on the board to choose a new chief executive, particularly given the board's poor track record of CEO selection.
The letter comes following the departure of Peter Plumb as Just Eat's boss. The online takeaway platform in January said Plumb will step down with immediate effect and Chief Customer Officer Peter Duffy will be promoted to interim CEO, while a permanent replacement is sought.
"The board's experiment of appointing an industry outsider like Plumb to the CEO role failed miserably and destroyed shareholder value. Now Just Eat needs a world-class management team with online food delivery experience and proven delivery capabilities. A merger is an obvious path for securing these advantages for the company," said Cat Rock Founder & Managing Partner Alex Captain.
Cat Rock warned that it would take further action if Just Eat's board continued to ignore shareholder feedback and failed to seriously and expeditiously explore merger options for value-creation.
Just Eat is slated to hold its annual general meeting on May 1.
In December 2018, Cat Rock described Just Eat as the "worst-performing public equity in online food delivery globally" and demanded changes. Cat Rock called for the sale of Just Eat's non-core assets and adoption of a three-year financial plan.
Just Eat shares were up 1.3% at 713.40 pence Monday.
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