Online takeaway service Just Eat has acquired its main Irish rival Eatcity.ie for an undisclosed sum. The deal has angered a number of independent restaurants who claim it will lead to closures and job losses.
Eatcity, which was used by a number of well-known restaurants, including Camile Thai, Mao and Pizza Hut, has about 250 restaurant clients, with approximately 75 per cent of these also listed with Just Eat.
"We have enjoyed tremendous growth and success at eatcity over the past four years and are very proud of the impact we have had on the online takeaway sector. Looking to the future however, we felt that we had brought the business as far as it could go and we are going to concentrate on our Point of Sale business Captiva POS," said Eatcity's managing director Eddie Carty.
Just-Eat.ie, which made a successful £1.5billion (€1.8 billion) debut on the London Stock Exchange earlier this year, launched in Ireland in May 2008. It is now the third biggest market for the group. Just Eat has about 1,5000 restaurants signed up in Ireland with a further 40 being added each month. It processes an average of 45,000 orders per month..
According to Euromonitor, 25 per cent of Irish consumers have a takeaway at least once a week,The Irish takeaway market was estimated to be worth €251 million in 2012.
The company said the acquisition would further consolidate its leadership position in the Irish market.
"Typically our larger clients are now getting 30 per cent of their orders via the Just Eat app or website each week - delivering significant additional revenue to their business. We look forward to delivering similar benefits to Eatcity.ie's restaurants - bringing even more value to their business. We are also looking forward to offering our consumers increased diversity and range of cuisine as we add new restaurants to our service," said Amanda Roche Kelly, managing director of Just Eat.ie.
Not everybody is as happy about acquisition however. A number of independent takeaways, said the move would jeopardise jobs.
Camile Thai, which operates six takeaways in Dublin, said that with up to 45 per cent of sales coming through the Eat City website, the new deal was “designed to force companies to use the technically inferior Just Eat service, with an instant hike in the commission rate from 5 per cent to 12 per cent.”
“We cannot sustain a unilateral price increase like this. This will cost Irish jobs and put many Irish businesses like ours, which are just starting to recover from the effects of the recession at serious risk of closure” said Brody Sweeney, owner of Camile Thai and founder of O’Briens Irish Sandwich Bars, which went into liquidation in 2009.
“We call on Just Eat to reverse their plans, in order to allow Irish businesses make alternative arrangements,” he added.
