Delivery Hero, a Berlin-based food delivery giant, recently alerted investors about a potential antitrust fine that could reach up to €400 million. The news was initially reported by Reuters and comes after European Union authorities conducted unannounced raids on the offices of Delivery Hero and its Spanish subsidiary Glovo in July 2022 and November 2023.
While the companies were not named by the EU at the time of the raids, both Delivery Hero and Glovo confirmed that inspections had taken place. The European Commission expressed concerns regarding possible violations of competition laws related to the formation of cartels and other restrictive business practices.
In a statement to investors released on Sunday night, Delivery Hero disclosed that it might be fined for an “alleged anti-competitive agreement to share national markets, exchanges of commercially sensitive information, and no-poach agreements.” This warning follows the company setting aside €186 million in its annual report last year in response to the EU inspections.
Delivery Hero emphasized its commitment to cooperating with the European Commission during the investigation, as it did during the previous unannounced inspections. The company’s increased provision for potential fines reflects recent discussions with the Commission and a detailed analysis of the situation.
The German delivery giant acquired a majority stake in Glovo at the end of 2021, shortly after the Spanish company consolidated three of its sub-brands. The food delivery sector has seen rapid consolidation as companies vie for top market positions in an industry with narrow profit margins.
Following the post-pandemic decline in food delivery demand, many businesses have struggled, highlighting the challenges of the industry’s economic model. The exits and closures underscore the difficulties faced by companies in the food delivery space as they navigate changing market dynamics and consumer behaviors. Delivery Hero’s warning of a substantial antitrust fine adds another layer of complexity to the company’s operations and future outlook.
