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Thu 12th Oct 2017 - Update: Just Eat acquisition of Hungryhouse cleared, Mark Jones
CMA – Just Eat acquisition of Hungryhouse does not raise competition concerns: The Competition and Markets Authority (CMA) has reached a provisional conclusion that Just Eat’s acquisition of Hungryhouse does not raise competition concerns. In a provisional report, published by the CMA today, a group of independent panel members investigating the merger has found that, on balance, it is unlikely to result in competition concerns. The group found that Hungryhouse presently provides limited competition to Just Eat because it is much smaller in size and offers too few unique restaurants, making it increasingly difficult for Hungryhouse to attract and retain consumers. Furthermore, it found that the industry is evolving rapidly following the entry of platforms, such as Deliveroo, UberEATS and Amazon, which also manage or facilitate delivery services on behalf of restaurants. These companies generally present a greater competitive challenge to Just Eat than Hungryhouse, and this is likely to grow as they expand. In reaching its provisional conclusions, the group also took account of consumers’ ability to order directly from takeaway restaurants, either by telephone, through their websites or by walking in. Martin Cave, Inquiry Chair, said: “We carefully assessed competition in this rapidly evolving industry to make sure this merger would not result in increased prices or reduced quality of offering for either restaurants or their customers. We obtained evidence from all the major industry participants and carried out surveys, with the public and restaurants, to understand how the merger could impact both types of customers. We found that Hungryhouse was a weak competitor to Just Eat and so competition is unlikely to be substantially reduced by this merger, especially given the entry and rapid expansion of innovative suppliers in this sector.” The CMA is now asking for views on these provisional findings and will assess all the evidence before making a final decision. Anyone wishing to respond to the provisional findings should do so in writing, by no later than 12pm on 2 November 2017. Just Eat stated: “We are pleased that the CMA has provisionally concluded that this transaction does not lessen competition. We look forward to continuing to deploy our technology and expertise to help more independent restaurants develop and grow their businesses, while offering an even better service to consumers. We will continue to work with the CMA ahead of its publication of a final decision, expected in November.”

Mark Jones to step down from Goals Soccer Centres: Goals Soccer Centres, the operator of outdoor small-sided soccer centres with 48 sites, including two in California, has announced that chief executive Mark Jones, who ran Yates’s and Pizza Hut earlier in his career, has notified the board of his intention to resign from the board and the company as he has decided to take another role in the private sector. The company stated: “The search for a strong successor has already commenced and the board will update on this process when appropriate. In order to further progress the strategic turnaround of the company, Mark will continue in his role whilst his successor is sought. The board wishes to thank Mark for his contribution and wishes him well for the future.”

Booker Group reports sale and profit rise: Booker Group has reported total sales were £2.6bn, up 2.5%, with non-tobacco up +7.5% and tobacco down 9.0% due to changes in legislation, in the 24 weeks to 8 September. Like-for-like sales +2.7%, non tobacco like-for-like sales up 7.7%, and tobacco like-for-like sales down 8.7%. Profit before tax was £88.0m, up 9%. Internet sales were up 11% to £560m. The company stated of its merger with Tesco: “On 27 January we announced the planned merger with Tesco PLC to form the UK’s leading food business. This combination should improve choice, quality, prices and service for the UK consumer. It should also help the Booker catering, retail and small business customer prosper in a challenging market. Our proposed merger with Tesco is undergoing an in-depth ‘Phase 2’ investigation by the Competition and Markets Authority (CMA). Provisional findings are expected to be made public by the CMA by the end of this month, ahead of a final report by the end of the year. It is expected that the merger will complete in early 2018, subject to, amongst other things, the necessary shareholder approvals. During this process Booker will continue to ensure it is “Business as Usual”. We are excited by the opportunities the merger will create for consumers, our customers, suppliers, colleagues and shareholders.” Charles Wilson, chief executive of Booker, said: “Booker Group continues to make good progress with like-for-like non tobacco sales up 7.7%. Our plans to Focus, Drive and Broaden Booker Group are on track. The competition review of the planned merger with Tesco is progressing. We continue to help our retail, catering and small business customers prosper through improving our choice, prices and service.”

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