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Wonder is acquiring Grubhub

(about.grubhub.com)
146 points endtwist | 9 comments | 13 Nov 24 19:12 UTC | HN request time: 0.209s | source | bottom
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chirau ◴[13 Nov 24 19:20 UTC] No.42129001[source]▶
How do these deals work?

I am assuming, and I could be very wrong, that Wonder is smaller by market cap than Grubhub.

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kelnos ◴[13 Nov 24 20:19 UTC] No.42129518[source]▶
Both companies are private, so neither has a "market cap". They just need to agree on a price.

In this case, GrubHub had taken on a bunch of debt; Wonder agreed to assume it, and GrubHub's owners/investors get $150M in cash.

replies(1): >>42129695 #
1. JumpCrisscross ◴[13 Nov 24 20:35 UTC] No.42129695[source]▶
> Both companies are private, so neither has a "market cap"

Private companies have shares. Given a per-share price, you can get a market cap. For a company with debt, like GrubHub, enterprise value is a better metric.

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2. zemo ◴[13 Nov 24 20:43 UTC] No.42129782[source]▶
> Given a per-share price

how do you know the per-share price

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3. JumpCrisscross ◴[13 Nov 24 21:03 UTC] No.42129984[source]▶
> how do you know the per-share price

Same way you do for a public company. From trades and valuations. Private shares exchange hands in private transactions as well as almost every time the company raises money. If a company issues incentive stock options, they're required to calculate a 409A price, which while a bullshit number, is indeed a per-share price.

Corporations, by law, have shares.

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4. zemo ◴[13 Nov 24 21:29 UTC] No.42130196{3}[source]▶
> Same way you do for a public company. From trades and valuations.

how do you know what trades took place, and how many shares were traded, and at what price?

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5. JumpCrisscross ◴[13 Nov 24 21:53 UTC] No.42130470{4}[source]▶
> how do you know what trades took place, and how many shares were traded, and at what price?

Company generally has these records. Various other sources, e.g. PitchBook, compile them. In some jurisdictions (e.g. UK and India) they have to be publicly announced, though that's becoming less common.

TL; DR It is incredibly wrong to suggest private companies don't have a market cap. As in finance 101 wrong.

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6. zemo ◴[13 Nov 24 22:46 UTC] No.42131058{5}[source]▶
> Same way you do for a public company. From trades and valuations.

no, it's not the same, because the information is not publicly available. They are the same in that in both cases you multiply two numbers together; they are not the same inasmuch as your ability to know those numbers is vastly different. To say they're the same is misleading.

7. Thrymr ◴[13 Nov 24 22:59 UTC] No.42131164{3}[source]▶
But they don't need to publicly disclose it, so "you" probably don't know the price. Someone does, sure.
8. woooooo ◴[14 Nov 24 01:07 UTC] No.42132068{5}[source]▶
You don't think lack of liquidity, small number of transactions etc casts some doubt on the "true value" of those shares?

Did they really go from some big number to some small number in an eyeblink with this latest transaction?

replies(1): >>42132510 #
9. zemo ◴[14 Nov 24 02:21 UTC] No.42132510{6}[source]▶
look at their about page, they have access that you don't have. They literally don't understand.