Support for Just Eat shares falls away as it loses Buttress
INVESTORS lost their appetite for online takeaway service Just Eat after chief executive David Buttress resigned.
Buttress, who launched Just Eat’s UK business in March 2006, is stepping down at the end of March due to “urgent family matters”. Long standing chairman John Hughes will assume an executive role until a replacement is found.
Analyst David Reynolds of Jefferies said Buttress was “a profound loss” to the business, while Tal Grant, of UBS, said investors regarded him as “a key asset” in the company.
Buttress became chief executive in 2013 and the company went public under his leadership the following year. Since then, shares in the mid-cap group have more than doubled.
However, this isn’t the first high-profile departure at Europe’s biggest online takeaway company. Last June, finance director Mike Wroe surprised investors by leaving the company after eight years.
Neil Campling, of Northern Trust Capital Markets, said the announcement “couldn’t come at a more challenging time” for Just Eat, pointing to a slowing fourth quarter in UK order growth “we see as a significant deceleration of growth at a time competition has intensified and is the first quarter in which Uber and Amazon has entered the market”.
Just Eat is also in the process of buying UK rival Hungryhouse and integrating SkipTheDishes in Canada. Shares slumped to their lowest level in three-and-a-half months, plunging 36p, or 6.5pc, to 518½p.
The FTSE 100 enjoyed gains of 29.25 points, or 0.4pc, to close at 7,258.75 as mining stocks rallied. Better-than-expected Chinese trade data lifted copper prices higher. BHP Billiton rose 32p to £13.70, Rio Tinto jumped 190½p to £35.73, Antofagasta advanced 38½p to 866p,
Anglo American climbed 57p to £13.53 and Glencore closed up 8.6p at 320.8p.
Despite rallying to a three-month high of £73.81 in intraday trade, Reckitt
Benckiser tumbled into the red by close, down 214p at £70.25 after it confirmed the acquisition of baby food maker Mead Johnson for $90 a-share.
Elsewhere, turnaround investor Melrose enjoyed a rating upgrade from Exane BNP Paribas. The bank hiked its rating to “outperform” as it believes the group has chosen an attractive entry point into the US construction cycle through home ventilation systems manufacturer Nortek, which it agreed to buy in August. Shares edged up 2½p to 207p. In the same sector-wide note, Exane BNP cut Spectris and Rotork’s ratings to “neutral”, sending shares down 21p to £23.39 and 2.1p to 249.7p, respectively.
Broker Berenberg revisited the advantages of British American Tobacco’s deal to purchase the remaining 58pc of Reynolds American, upgrading its rating to “buy” from “hold”. Nevertheless, shares dipped 13p to £50.08.
On the mid-cap index, the British distributor of Raspberry Pi Electrocomponents dropped 28½p to 475½p, despite reporting revenue growth of 6pc in the four months to the end of January as it continued to make progress to stabilise profits and reduce costs.
Finally, speciality chemicals maker Elementis bounced 27.8p, or 10.1pc, higher to 303p after it said it would buy US-based Summit Reheis for $360m.