Any late-night announcement by a listed company usually contains something interesting. It is even more interesting if it deals with share transactions during hostile takeovers and quotes a few paragraphs of legalese from the relevant stock exchange rules.

Prosus has been accused of “selling down” and trying to depress the share price of its rival Takeaway.com in the fight to gain control of Just Eat. The Just Eat board of directors has recommended to its shareholders that they accept an offer from Takeaway.com that will result in a merger of the two food delivery businesses rather than consider the rival cash offer from Prosus.

It raised suspicions when it emerged that a Takeaway.com shareholder, Delivery Hero, started to sell shares quite aggressively and that Prosus holds an interest in Delivery Hero.

Prosus responded on Monday night with a statement to say that it does not control Delivery Hero or its investment decisions. “Prosus had not disclosed its interest in making an offer for Just Eat to Delivery Hero prior to the issue of its Rule 2.7 announcement,” reads the statement.

It added that Delivery Hero confirmed this in a separate statement. “The decision to sell down Takeaway.com was taken by Delivery Hero’s management board independently in September 2019. Delivery Hero had no knowledge of Prosus’s contemplated offer to acquire Just Eat prior to the publication of the offer,” says the Delivery Hero statement.

Prosus also points out that shares of most companies in the broader food delivery sector, including that of Delivery Hero itself, traded lower between Delivery Hero’s announcement of its share selling and the announcement by Prosus of the cash offer to buy Just Eat.

Rules and regulations

The rules and regulations quoted by Prosus in its statement deal with disclosing shareholdings when a company makes an offer to buy another listed company and the time frame in which the disclosures must be made.

There is no mention of “related parties”or “parties acting in concert” in the piece of rules quoted in the Prosus statement.

The listing of Prosus in Amsterdam will, in time, teach South African investors and analysts a few things about Holland’s listing regulations. But we can assume that it would not be much different to JSE rules, which look closely at shareholdings of related parties and their voting decisions when it comes to takeovers and mergers.