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LONDON (Reuters) - British online takeaway food service Just Eat (LONDON:JE) said on Friday it would enter the Australian and New Zealand market with the purchase of Menulog Group for 445 million pounds ($687 million), financed from the proceeds of an equity issue.
Just Eat, which listed just over a year ago, said Menulog is the market leader in the Australian and New Zealand online takeaway market, with 5,500 unique restaurants and 1.4 million active consumers.
Menulog made 13.5 million pounds of revenues and 1.2 million pounds of underlying earnings in the year to March 31, 2015 and saw year-on-year order growth of 96 percent in the final quarter of the year.
"The Just Eat directors believe there is a compelling rationale for the acquisition of Menulog which will allow it to acquire a market leader in a market of significant scale," it said.
It noted that the size of the Australian and New Zealand takeaway delivery market is estimated at 1.6 billion pounds, with the online penetration rate estimated at 22 percent.
Just Eat expects the deal to be accretive to earnings in the first full year of ownership and said there would be cost and revenue synergies.
The deal will be entirely financed from a proposed equity fundraising in the form of a placing and open offer.
Shares in Just Eat closed Thursday at 496 pence, valuing the business at 2.8 billion pounds.