Netherlands-based food delivery company Just Eat Takeaway.com announced Wednesday that it is selling its U.S. Grubhub business to New York-based Wonder Group in a deal valued at $650 million. which is 91% less than the $7.3 billion paid by Just Eat Takeaway. for the company just four years ago.

The deal is expected to close in the first quarter of 2025, and Grubhub expects net proceeds of $50 million. Wonder, which started as a food delivery company in 2018 but has since pivoted to operating delivery-focused restaurants in New York and Philadelphia, will assume $500 million of Grubhub’s debt.

The divestiture comes as food and grocery delivery becomes an increasingly unprofitable business for companies that bet on the farm on the model during the COVID-19 pandemic and later as people shelter in place on site and respecting social distancing chose to order food and groceries that they previously would have. buy in person.

The food delivery and quick commerce industries saw a massive influx of venture capital and other investments in the following years, with startups like Getir And Flink raise millions and invest aggressively in marketing and acquisitions.

But once the world returned to some semblance of normalcy and the post-pandemic tailwinds calmed, the instant delivery model proved untenable. Flink is now said to be valued at just under a billion dollarsdescending from a peak of almost 3 billion dollarswhile Getir withdrew, stop its operations in the US, UK and Europe to focus on its home market, Turkey.

Just Eat Takeaway itself has been trying to sell Grubhub for years. Business first announcement it planned to sell Grubhub in April 2022 to focus on profitability, less than a year after striking the acquisition deal, but last year its CEO said a sale was proving “very difficult”.

“The sale of Grubhub to Wonder will increase Just Eat Takeaway.com’s cash generation capabilities and accelerate our growth,” Jitse Groen, CEO of Just Eat Takeaway, said in a statement. The company said the sale would allow it to invest in countries where it has a competitive advantage and generate free cash flow.

Wonder CEO Marc Lore said the company aims to create a super app for food delivery through this acquisition.

“We’re excited to soon offer a curated selection of Grubhub restaurant partners directly in the Wonder app, alongside our owned and operated restaurants and meal kits. Bringing Wonder and Grubhub together is the next step in our vision to create the super app for mealtime, re-envisioning the future of food delivery,” he said in a statement.

Wonder has raised more than $1.7 billion in funding, according to Crunchbase, from backers including Accel, Bain Capital Ventures, Google Ventures, Nestlé and Forerunner Ventures.