(Bloomberg) — Just Eat Takeaway.com NV will enter the competitive business of delivering British consumers their groceries with a new partnership, marking the latest company seeking a slice of local supermarket spending.
The Amsterdam-based restaurant delivery company will launch a trial partnership with U.K. grocer Asda Group Ltd. in the first quarter of next year, according to a person familiar with the matter. As part of the trial, Just Eat customers will be able to order groceries from five Asda stores, with the expectation that the choice will grow over the course of the year, the person said, asking not to be identified discussing information that isn’t public.
Just Eat has been offering hot pizza delivery from Asda since 2019, but the new roll-out is its first significant move into U.K. grocery delivery.
A representative for Asda confirmed the relationship. Just Eat didn’t immediately respond to a request for comment.
Just Eat has been under pressure from investors to turn around its lagging share price. The company, which owns Grubhub, one of New York’s biggest food delivery apps, had previously said there wasn’t enough money in grocery delivery. But in August, Chief Executive Officer Jitse Groen said that his thinking on the issue had “evolved” and the company is now investing in the category.
By expanding into the U.K. grocery delivery market, Just Eat will be competing against the likes of Uber Technologies Inc. and Deliveroo Plc, which is building out a rapid grocery service alongside an offering allowing customers to order from supermarkets.
Read more: Investors Want to Know How Just Eat Will Deliver for Them
Walmart Inc. ceded control of Asda earlier this year and it is now run by a consortium of Britain’s Issa brothers and TDR capital.
In recent years Asda has been the most challenged of Britain’s “big four” grocers as it has no real presence in the convenience store sector and, as a “value retailer,” has been more susceptible to the threat from the price-competitive German discounters Aldi and Lidl.
Asda’s big four rivals – Tesco Plc, J Sainsbury Plc and Wm Morrison Supermarkets, which was recently taken over by U.S. private equity firm Clayton Dubilier & Rice – are already making inroads to the rapid grocery delivery market. Tesco, Britain’s biggest grocer, recently announced a tie-up with Gorillas, and Sainsbury’s is working with Deliveroo and Uber Eats. Morrison recently expanded its partnership with Deliveroo, testing a mini-fulfillment center in a London to offer rapid delivery of essential items.
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