Amazon recently secured a 2 percent stake in Grubhub and will now be offering the premium food delivery service Grubhub+ to Amazon Prime users for free for one year. Grubhub+ gives users access to member-only deals, removes restaurant fees, and minimizes delivery charges when ordering delivery.
The news comes just days before Prime Day kicks off this Tuesday. The two-day Amazon event features significant discounts on many products.
Amazon’s investment comes as good news to Just Eat Takeaway, the European parent company of Grubhub which purchased the U.S. delivery service last year in a $7.3 billion transaction. The company has reportedly struggled to find a buyer for Grubhub, and stocks dropped 70 percent until Amazon’s intervention, which increased shares by over 15 percent.
According to a Restaurant Business report, investors like Cat Rock Capital have urged Just Eat Takeaway to sell Grubhub, arguing that the acquisition devalued the parent. A Reuters report also suggested that demand for online delivery apps has waned following the height of the Covid-19 pandemic.
In a statement about the partnership, Ariella Kurshan, senior vice president of growth at Grubhub said, “Both Grubhub and Amazon have transformed people’s lives by providing them with unprecedented choice and convenience…With the new Grubhub and Amazon offering, Prime members now can enjoy free delivery from hundreds of thousands of restaurants across the country, when they sign up for a year of free Grubhub+. I’m thrilled that new Grubhub diners from Amazon can get even more delivered to their door with their Prime membership.”
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