Amazon works with Just Eat to deliver food in the United States.

(Reuters) – Amazon (NASDAQ:AMZN) has agreed to buy a 2% stake in Just Eat’s struggling U.S. meal delivery business, Grubhub, and will give Prime members access to the service for a year.

The deal is a big relief for Europe’s biggest meal delivery company, Just Eat Takeaway, whose stock had dropped 70 percent this year. Shareholders have asked that Grubhub, which they bought last year for $5.8 billion in shares, be sold or partnered with.

In a statement, Just Eat Takeaway said that it is still “exploring the partial or full sale of Grubhub,” but there is no guarantee that a deal will be made.

Analysts from JPMorgan (NYSE: JPM) said in a note about the Amazon deal that it would bring in new customers and strengthen Grubhub’s position in the United States. This is similar to a deal Amazon has with Just Eat competitor Deliveroo in Britain.

“While Grubhub is now only a smaller part of Just Eat Takeaway’s portfolio, representing about 20 percent of estimated 2023 revenues, this step improves JET’s position in potentially selling (Grubhub),” analysts wrote.

At 08:38 GMT in Amsterdam, shares of Just Eat were worth 16.13 euros, up 17%.

As part of Amazon’s “Prime Day” sale in July, which was announced on Wednesday, customers will get free delivery on orders over $12 in the 4,000 cities where Grubhub does business.

The deal will bring more customers to Grubhub, which has been losing business to Doordash and Uber Eats as the COVID-19 pandemic’s effects fade.

In exchange, Amazon will get warrants for 2 percent of Grubhub’s shares and an additional 13 percent of shares if the deal brings Grubhub enough customers.

Just Eat Takeaway said in a statement. “The agreement is expected to grow the number of Grubhub+ members while having no effect on Grubhub’s earnings and cash flow in 2022,” “From 2023 onwards, Grubhub’s earnings and cash flow will grow.”

The company said that Grubhub’s total assets were worth 6.5 billion euros ($6.67 billion) at the end of 2021, and it lost 403 million euros before taxes in that year.

($1 = 0.9746 euros)

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