Delivery Hero (1K) | Buy | The takeover genie is out of the bottle

Research evidence excerpt

Delivery Hero (1K) | Buy | The takeover genie is out of the bottle

Delivery Hero Buy | Target Price: EUR45.00

Delivery Hero becomes the centre of attention

According to an article in the Financial Times (FT) on Saturday 23 May, Uber met with the head of

Delivery Hero's supervisory board and offered Kristen Skogen Lund to take over Delivery Hero

entirely for a price of EUR33 per share. On Friday, the shares closed at EUR33.60.

On 24 May, the FT published another article, mostly mentioning additional topics according to

"...people familiar with the matter...":

- Uber held a board meeting on Saturday, discussed the matter and is said to be considering

whether it wants to increase its offer ("people familiar with the matter").

- Uber apparently offered one of Delivery Hero's largest shareholders EUR38 per share, but the

offer was rebuffed ("people familiar with the matter").

- Competitor DoorDash was mentioned to have also looked at Delivery Hero but has not made

any purchases ("...people familiar with the matter...").

- According to the article, several shareholders told the FT they were seeking a share price north

of EUR40. This would value Delivery Hero at c. EUR12.5bn and be a 19% premium over Friday's

closing price.

- Any transaction would certainly be subject to regulatory scrutiny.

- Morgan Stanley is said to be working on Uber's bid ("...people said...").

- The article stated that Uber may buy Delivery Hero derivatives to take its indirect ownership

above the 30% hurdle, which would give it the opportunity, once the derivatives are converted

into voting shares, to offer a mandatory takeover bid ("...people said...").

- Delivery Hero is considering spin-offs of its Middle East and South Korean operations ("...people

said...")