According to a recent news article published by TechCrunch, South African-based media and internet company Naspers has acquired an additional 13 percent stake in food delivery and takeout service Delivery Hero.
Naspers had previously invested in the company when it went public earlier in 2017 and, with the additional 22.4 million shares, worth approximately $775 million USD, Naspers now claims 26.3 percent ownership of Delivery Hero, TechCrunch reported.
“Delivery Hero is already the leading online food ordering and delivery marketplace in most of the countries in which it operates, and our increased investment demonstrates our confidence in long-term prospects for the company,” said Bob van Dijk, Naspers’ CEO. “The food delivery sector is still underpenetrated and growing rapidly across the world. Many markets have experienced significant traction already, but we believe the potential is far greater in high-growth markets than that observed in the West.”
The media company has made other investments in recent months, including in classified advertising, online financial services and payment methods, according to the news article. The acquisitions are likely to gain a foothold in the food takeout and delivery market, TechCrunch surmised.
The food delivery industry includes companies like Deliveroo, which reported it had raised $385 million in funding and was boasting a more than $2 million valuation. Amazon and UberEATS are also competitors, though Seamless and GrubHub in the U.S. — where Delivery Hero does not currently operate — are not.
Delivery Hero recently released the results of the first half of its financial year, posting a 66 percent increase in revenue and showing signs of growth despite still operating at a loss. According to TechCrunch, the company will likely break even in 2018.
“We’ve known the Naspers management team for a couple of years and built very close and trustful relationships,” said Niklas Ostberg, CEO of Delivery Hero. “They came in as a long-term shareholder, committed to Delivery Hero, committed to the vision and values of our company and management team. We are excited about their willingness to increase their stake as they have seen our business develop.”
TechCrunch reported the acquisition transaction, which is expected to close in Q1 2018, will be funded from existing sources and subject to regulatory approval.