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CMA provisionally clears Just Eat/Hungryhouse merger

The Competition and Markets Authority (CMA) has reached a provisional conclusion that Just Eat’s acquisition of Hungryhouse does not raise competition concerns.

Just Eat and Hungryhouse are web-based food ordering platforms in the UK. They give restaurants the opportunity to reach a wider pool of people, as well as offer consumers the convenience of choosing from a large range of takeaway providers in one place.

In the summary of provisional findings, 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.