Delivery Hero signs deal with Glovo worth 170 million euros
It became known about the deal between delivery services Delivery Hero and Glovo. The latter plans to buy several brands that are part of Delivery Hero for 170 million euros. Among them are Foodpanda, which operates in Romania and Bulgaria, Pauza in Croatia and others.
Delivery Hero company provides food delivery services in 50 countries. It operates in Asia, Africa, Latin America, Europe and the Middle East. A deal with Glovo for units in Bosnia and Herzegovina, Montenegro and Croatia should be signed in the near future. However, in order to do so, the parties must fulfill all the requirements outlined earlier in the agreement process. In addition, the companies must obtain regulatory and antitrust approvals.
In addition to the deal with Delivery Hero, Glovo has agreed to merge with the service Ehrana, which is located in Slovenia. Thus, the company implements a strategy to expand its position in Central and Eastern Europe.
The startup Delivery Hero was founded in 2010 in Berlin, initially had 25 employees, and now the company employs more than 25 thousand people in different countries. The service unites the largest network in the world (excluding China), which includes more than 500 thousand catering establishments.
Delivery Hero’s profitability depends on the percentage of commission that is charged when ordering food from a restaurant. And the service’s income depends primarily on the number of orders processed. The food is delivered by the company’s couriers.
Delivery Hero received its first investment of 8 million euros in 2011, a year later the investment reached 80 million euros. The company was actively developing, and by 2017 the management decided to go public. At the same time there was a merger with the service Foodpanda, as a result of which Delivery Hero became a 37.7% stake in the service.
In a public offering on the Frankfurt Stock Exchange, the company raised 1 billion euros. Later, about 22% of the startup was taken over by Prosus & Naspers, making it the largest investor in the delivery service.
Delivery Hero’s key strategy is acquisitions and mergers with competitors, allowing it to expand its presence and enter new markets. In addition, the service regularly increases the level of customer service and the list of partner restaurants and cafes. The company’s management pays special attention to the countries where the takeaway culture is well-developed. For example, in Germany such services are not in high demand as in other countries, for example in Taiwan, where the number of delivery orders per month is 7.2 million. This figure is three times less than in Germany.