Just Eat to serve up '£1.47bn IPO'

IPO WATCH: The takeaway website is backing itself and is thought to be the first company to list on the London Stock Exchange's High Growth Segment.

by Rachel Savage
Last Updated: 14 Jan 2015

Just Eat could be valued at more than double previous estimates: the online takeaway service is pricing its shares at 2.10p-2.60p, according to an anonymous source. That makes the company worth a whopping £1.2bn-£1.47bn.

The website, which launched in Denmark in 2001 and now operates in 13 countries including the UK and Canada, is also expected to be the first company to list on the London Stock Exchange’s High Growth Segment. The details were sent out to institutional investors (retail investors aren’t due to get a slice of the takeaway pie).

Reports over the last couple of months had put Just Eat’s value at £700m-£900m, but listing on the HGS means the company’s current owners can hang onto more of their stake: it only requires 10% of shares to be sold compared to 25% on the main market.

The high pricing also means that Just Eat’s IPO is likely to be worth even more than that of US compatriot GrubHub, which was valued at $1.72bn (£1bn) on Monday

Just Eat’s revenues were £96.8m and underlying earnings were £14.1m last year, up 61.9% and 518% respectively from 2012. Chief exec David Buttress told the Telegraph yesterday that people need to pay attention to that growth, rather than the current level of earnings.

From Zuckerberg’s somewhat crazy buying spree (cf. Whatsapp and now Ocular VR), to exuberant dotcom IPOs, including appliances retailer AO and fashion site Boohoo.com, tech looks to be having something of a sparkling wine moment. As they say, what goes up, must come down...

Find this article useful?

Get more great articles like this in your inbox every lunchtime