How does an all stock acquisition of 7.3B USD work in this case?
Is this done via issuing more than an extra 100% of stock on the expectation the new asset will counteract the dilution to keep the stock price similar?
"Just Eat Takeaway was created this year through the $7.8 billion combination of two of the earliest participants in Europe’s food-delivery market, Just Eat and Takeaway.com. It has been fighting competition in Europe from Uber Eats and Deliveroo, a London-based company whose investors include Amazon.
Mr. Groen, a Dutch entrepreneur, founded Takeaway.com in 2000 when he was a student frustrated with the challenge of ordering pizza online. He took Takeaway.com public in 2016, and now has a net worth of more than $1.5 billion, according to Forbes.
In addition to the deals for Grubhub and Just Eat, Mr. Groen bought the German portion of Delivery Hero’s business for about $1 billion in 2018."
They've been aggressively acquiring competitors for years, so this seems par for the course.
Although this may not be a LBO situation, selling junk bonds is often the way that PE firms steal everything from firms they "buy". I have no idea how the "all-stock" claims jive with selling bonds. I suppose the buyer could just issue more of its own stock, if the numbers don't add up. [EDIT:] This last maneuver seems more plausible if the buyer itself was previously a LBO target and the PE dudes haven't totally drained it yet.
How is taking on debt, relevant to an all-stock deal? An all-stock deal means that Grubhub shareholders aren't receiving any cash, they are receiving $7.3B worth of JustEatTakeaway stock.
The only interpretation I can think of, is what the previous poster said - the existing shareholders of JET are getting significantly diluted
Just Eat Takeaway is an NV / Dutch firm (also mentioned on their Wikipedia page [1]), here's their listing:
https://www.cnbc.com/quotes/?symbol=TKWY-NL
I believe they're legally based in the Netherlands after the combination between Just Eat and Takeaway, and trade on both the Euronext exchange in Amsterdam and London Stock Exchange.
Here is how it's structured (from the Wall Street Journal):
"Grubhub shareholders would receive 0.6710 Just Eat share for each Grubhub share, now worth just over $65 / share after a decline in Just Eat shares Wednesday"
Here's what Business Insider quoted previously:
"Under the terms of the stock-swap deal, Just Eat is offering roughly 0.67 of its shares for every Grubhub share for an implied value of $75.15 per share, or $7.3 billion based on Tuesday's closing price, according to the statement."
Notice that $75 / share figure, at $7.3 billion, is prior to the drop in Just Eat's stock. The new $65 / share figure quoted by the Wall Street Journal is based on the change in the stock price of Just Eat, which plunged from roughly €100 to €85.
If Just Eat's shares continue to decline in value, GrubHub shareholders still receive the same share ratio (valuing the deal at a lower figure accordingly).
While it sounds like they're not doing this, yes, you can do this.