Berlin-based food delivery giant Delivery Hero has warned investors that it could “eventually” face an antitrust fine of up to €400 million.
The development, reported earlier by Reutersfollows unannounced raids by European Union authorities on the offices of Delivery Hero and its Spanish subsidiary Glovo in July 2022 And November 2023.
The EU did not name the companies involved at the time, but both confirmed that the inspections had taken place. The European Commission said it was concerned about possible violations of competition laws against cartels and other restrictive business practices.
In a Note to investors Published Sunday evening local time, Delivery Hero said it could face the penalty for “an alleged anti-competitive agreement to share national markets, exchange commercially sensitive information and no-poaching agreements.”
In its annual report last year, Delivery Hero said it had set aside €186m following unannounced inspections in the EU.
“The intention to increase the provision is based on a recent informal dialogue with the European Commission and a subsequent detailed analysis,” he wrote, explaining the increased amount set aside. “Delivery Hero intends to cooperate fully with the European Commission as it did during the unannounced inspections in July 2022 and November 2023.”
The German giant has acquired a majority stake in Glovo in the end of 2021 — about six months after the Spanish rival paid out to bring together three of its sub-brands.
Rapid consolidation has been a defining feature of the low-margin food delivery sector, with players jostling to grab the top positions (one or two) in markets in the hopes of making savings accrue.
After the pandemic, we saw dozens of market exits and a string of businesses that have closed shop after the lockdown-related food delivery boom became a distant memory – highlighting just how difficult the food delivery business model is.
