Activist investor launches searing attack on Just Eat over poor returns
One of Just Eat's shareholders has slammed the company’s management, saying the firm has become the “worst-performing public equity in online food delivery”.
Cat Rock Capital, which holds a two per cent stake in Just Eat, urged the board to offload non-core assets, provide a three-year financial plan and change pay incentives for executives in a bid to improve performance.
In a letter to chairman Michael Evans and chief executive Peter Plumb, the activist investor said: “These unambitious targets and flawed incentive schemes have significantly damaged the value of the business and shareholder returns.”
Shares in Just Eat have fallen over 25 per cent since the beginning of the year and the business dropped out the FTSE 100 earlier this month.
Alex Captain, Cat Rock founder and managing partner, slammed the company’s boss. “Since Peter Plumb became chief executive in September 2017, the company’s targets have been remarkably undemanding and have created little accountability for management to execute,” he wrote.
Captain gave the food delivery platform's management plenty of food for thought, calling on them to outline a three-year plan and link executive pay to achievements.
In addition, he said the board should consider offloading non-core assets, including Brazilian online food platform iFood.
The explosive letter comes as Just Eat faces increasing competition in the food delivery market.
Earlier this year the firm warned on profits amid a £300m spending spree aimed at aggressive growth and fending off rivals Deliveroo and Uber Eats.
A Just Eat spokesperson said: “We have a clear strategy in place to deliver long-term sustainable value for our shareholders, which is focused on providing the best possible experience for customers and restaurants on our platform.
“As you would expect, the board engages closely with shareholders to ensure management have an appropriate long-term incentive programme aligned to the exciting and unique growth opportunities of the Just Eat group.”