EDITORIAL: The deep-pocket effect
Prosus’s offer for Just Eat Takeaway may succeed, but not without testing its determination and commitment to prudent capital allocation
04 April 2025 - 05:00
Financial muscle is both a weapon and a liability in mergers & acquisitions. Prosus’s €4.1bn bid for Just Eat Takeaway is a textbook example of the “deep-pocket effect”, in which shareholder expectations inflate as soon as they smell the acquirer’s wealth.
Prosus, flush with a nearly $20bn war chest, has framed the €20.3 per share offer as a generous premium — 49% above Just Eat’s three-month volume-weighted average price. Yet BDL Capital Management, a small shareholder in Just Eat, argues the bid undercuts the fair valuation by 64%. ..
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.