City Pantry, the UK corporate catering marketplace, has been acquired by food delivery giant Just Eat
City Pantry, the office catering marketplace that lets one order in food for staff, company events and meetings, has been acquired by takeout marketplace and delivery giant Just Eat.
The price is described as an initial cash offering of £16 million, with a possible further payout due if City Pantry achieves agreed operational and financial targets over the next three years.
The premise of the acquisition is to enable consumer-focused Just Eat to further expand into the U.K. corporate catering market by leveraging City Pantry’s brand, technology and sector knowledge. City Pantry claims more than 1,000 monthly corporate customers.
Founded by Stuart Sunderland in 2013, City Pantry set out to improve the catering options available to companies in London. Its marketplace connects local caterers to businesses that need quality food delivered to their offices or to cover events, meetings and regular team meals.
When the startup first launched, Sunderland viewed its main competitors as traditional corporate caterers, sandwich retailers, pizza delivery places and, to a lesser extent, the newer breed of restaurant delivery companies such as Just Eat, Deliveroo and Uber’s UberEATs. However, as mindshare of these services has grown, it is likely that consumer and corporate catering has increasingly encroached on one another.
In this context, Just Eat’s acquisition of City Pantry makes a lot of sense for what is a relatively low price to gain a stronger foothold in the corporate market. Given that publicly listed Just Eat is coming under increasing pressure from Deliveroo and UberEATs, it is also smart to demonstrate continuing momentum to the public markets. Small incremental acquisitions like this are a tried and tested way of doing so.
City Pantry is thought to have last raised funding in early 2018: a £4 million round led by Octopus Investments, with participation from Newable Private Investing. The startup’s other backers included Angel CoFund and The London Co Investment fund (both of which are part-funded by U.K. tax-payer money). City Pantry was also a graduate of retail startup accelerator TrueStart.