LONDON – Shares in food delivery platform Just Eat briefly jumped on Friday morning after it was ruled that ride-hailing app Uber will no longer be allowed to operate in London, its biggest UK market.
Shares climbed aggressively just after 11.00 a.m. BST (6.00 a.m. ET), jumping roughly 20 pence per share to a high of £6.9350.
The rationale behind the jump seems to be that traders believed that the ruling from Transport for London – which said Uber was not “fit and proper” to hold a licence – will have a negative impact on Uber’s food delivery business Uber Eats, and allow Just Eat, a direct competitor, to gain market share.
This is not the case, with the ruling impacting only Uber’s core ridesharing business.
“The licence only applies to private-hire operations as it’s granted by Transport for London so UberEATS is not impacted by the licence – or lack of,” an Uber statement given to Metro said.
Traders seem to have realised their mistake in fairly short order, with their shares in Just Eat falling off their highs fairly quickly.
Here is the chart showing the jump and subsequent pull back:
TfL said Uber was not "fit and proper" to hold a licence, and said the firm's approach to reporting serious driver offences, approach to driver medical and safety checks, and use of its secret "Greyball" software to dodge transport officials all contributed to its decision.
