By Pushkala Aripaka and Samantha Machado
(Reuters) - Britain's competition watchdog will probe Takeaway.com's (AS:TKWY) buyout of Just Eat (L:JE), possibly delaying completion of the multi-billion dollar deal to create one of the world's largest meal delivery companies.
The investigation is a blow for the online food ordering company after it fought a prolonged battle with rival Prosus NV (AS:PRX) to buy Just Eat, the market leader in UK food delivery.
The UK's Competition and Markets Authority (CMA) changed its position on the deal and now believes a probe may be warranted, Takeaway said on Thursday, adding that the regulator would be looking into whether it would have re-entered the UK market without the current deal in place.
A CMA spokeswoman confirmed it would open an investigation but gave no further details.
Takeaway said it pulled out of the loss-making UK market in 2016 after struggling with stiff competition. That year, the business lost 768,000 pounds ($1.01 million) and made revenues of just 76,000 pounds.
"Takeaway.com confirms that it did not have the intention to re-enter the UK market absent the transaction with Just Eat," the Dutch company said, adding it would respond to the CMA's questions and that it was confident of getting a green light.
Earlier this month, Just Eat's shareholders agreed to the all-stock deal valued at 6.2 billion pounds over a rival bid from tech investment giant Prosus NV.
Just Eat and Prosus did not immediately respond to a request for a comment.
Takeaway has said the combination will achieve annual cost savings of about 20 million euros ($22.2 million) from centralising orders on its platform, unifying brands and improving purchasing.
The probe comes after the UK watchdog launched an in-depth investigation into Amazon.com Inc's (O:AMZN) purchase of a stake in online food delivery group Deliveroo last month after the companies failed to assuage its initial concerns.