What to watch: Just Eat to buy Grubhub, Unilever ends dual structure, Lufthansa jobs

Edmund HeaphyFinance and news reporter
Yahoo Finance UK
The merger between Just Eat Takeaway.com and Grubhub would create a transatlantic food delivery powerhouse. (Alex Burstow/Getty Images)
The merger between Just Eat Takeaway.com and Grubhub would create a transatlantic food delivery powerhouse. (Alex Burstow/Getty Images)

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:

Just Eat confirms takeover of Grubhub

Just Eat Takeaway.com (JET.L) said late on Wednesday that it had agreed to buy Grubhub (GRUB) for $7.3bn (£5.8bn), in a move that will create one of the world’s largest food delivery firms.

The merger would create a transatlantic food delivery powerhouse, and represents a further coup for Jitse Groen, the chief executive of Just Eat Takeaway.com.

The deal follows the collapse of merger talks between Uber (UBER) and Grubhub, after US lawmakers pushed antitrust officials to investigate the potential deal.

Just Eat Takeaway.com is the result of a recent £6.2bn ($7.8bn) merger between London’s Just Eat and Amsterdam’s Takeaway.com

Under the terms of the deal, Grubhub’s shareholders would take a 30% stake in the combined group. The merger will need approval from both sets of shareholders.

Matt and I are the two remaining food delivery veterans in the sector, having started our respective businesses at the turn of the century, albeit on two different continents,” Groen said in a statement, referring to the chief executive and founder of Grubhub.

“Both of us have a firm belief that only businesses with high-quality and profitable growth will sustain in our sector. I am excited that we can create the world's largest food delivery business outside China.”

Unilever to end Anglo-Dutch structure with London HQ

Consumer goods giant Unilever (ULVR.L) said on Thursday that it plans to put an end to its dual Anglo-Dutch structure and combine into a single London-headquartered company.

The maker of Marmite, Dove, Hellmann’s, and Ben and Jerry’s ice cream said its Amsterdam-based entity would be merged into its UK division if the proposal is approved by shareholders, arguing that a single legal structure would give it “greater strategic flexibility.”

The conglomerate said that its “strong presence in both the Netherlands and the United Kingdom will remain unchanged”, noting that it did not plan to make adjustments to its staffing, operations, or activities.

The company will remain listed on exchanges in London, Amsterdam, and New York, it said. 

Its decision to shift to a London-based headquarters follows a 2018 shareholder rebellion, which saw it forced to reverse its decision to switch its headquarters from London to the Netherlands.

“Unilever’s board believes that unifying the company’s legal structure will create greater strategic flexibility, remove complexity and further improve governance,” said Unilever chairman Nils Andersen.

Unilever employs around 6,000 people in the UK and 2,500 in the Netherlands.

Germany’s Lufthansa to axe 26,000 jobs

German flag carrier Lufthansa (LHA.DE) said on Thursday that it planned to axe 26,000 jobs, noting that it expected a “slow” recovery to demand within the airline industry.

Lufthansa said that it would operate 100 fewer aircraft following the coronavirus crisis, leading to an excess of 22,000 full-time positions, or 26,000 employees, across the Lufthansa Group.

Half of the job losses will fall on staff in Germany, the airline said.

Like all of its global competitors, Lufthansa was forced to ground nearly all of its fleet for the past couple of months, as coronavirus lockdowns brought the global aviation industry to a near-total standstill.

“The recovery in demand in the air transport sector will be slow in the foreseeable future,” the airline said on Thursday.

It suffered a 98% slump in passengers in April, and a 26% drop in passenger numbers in its first quarter compared with the same period last year.

British Gas owner Centrica axes 5,000 staff in manager cull

The owner of British Gas has announced thousands of staff are set to lose their jobs, in a move its leader said would cut costs and halt the company’s “decline.”

Centrica (CNA.L) confirmed plans on Thursday to slash around 5,000 jobs, warning its earnings had halved in recent years. Around half the job losses are expected to hit managers, including around 20 of the 40 current members of its senior leadership team.

The company said in an update to investors the restructure would create a “less bureaucratic organisation,” but a union organiser warned it would fight for every job. The majority of the cuts are likely to hit in the second half of the year after consultation with staff, though senior figures are expected to leave by August.

Britain’s biggest household energy supplier also announced plans to standardise and “modernise” employment contracts, which could prove controversial among its remaining staff. 

European stocks fall after US Fed predicts 'long road' to recovery

European stocks fell on Thursday after the Federal Reserve warned that it expected there to be a “long road” to economic recovery in the US, fueling fears about a protracted return to growth in the global economy.

The central bank left interest rates steady at near-zero levels, projecting elevated US unemployment for years and a 6.5% fall-off in US economic output in 2020.

The pan-European STOXX 600 index (^STOXX) fell by around 2.5%, while London’s FTSE 100 (^FTSE) was down by around 2.4%.

Germany’s DAX (^GDAXI) declined by around 2.6%, while France’s CAC 40 (^FCHI) was 2.9% in the red.

“Last night’s Fed meeting turned out to be every bit as dovish as was expected, with the US central bank painting a fairly subdued outlook for the US economy,” said Michael Hewson, the chief market analyst at CMC Markets UK.

What to expect in the US

Futures were pointing to a sharply negative open for US stocks on Thursday.

S&P 500 futures (ES=F) fell by around 1.8%, while Dow Jones Industrial Average futures (YM=F) were down by almost 2.2%. Nasdaq futures (NQ=F), meanwhile, were down by more than 1.4%.

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