Yelp shares rallied more than 18 percent in after-hours trading on Thursday, after announcing it would sell one of its businesses to GrubHub and buy back $200 million worth of shares.

Yelp will sell Eat24, an online food ordering business, to GrubHub, the parent company of Seamless and MenuPages. The $287.5 million all-cash deal will unite Yelp and GrubHub in a partnership that allows Yelp users to order online directly from GrubHub.

Lanny Baker, Yelp’s chief financial officer, said in a statement that the deal “demonstrates the value we’ve created over the past two years.” Yelp acquired Eat24 for $134 million in 2015.

GrubHub shares fell more than 7 percent after hours.

Yelp also announced second quarter earnings on Thursday, handily beating analysts’ estimates and turning an unanticipated profit. Yelp reported earnings of 9 cents per share on revenue of $209 million. Analysts polled by Thomson Reuters expected a loss of 3 cents per share on revenues of $205 million.

Source: Tech CNBC
Yelp shares skyrocket 18% after announcing deal to sell Eat24 to GrubHub