German Delivery Hero takes 5.1% stake in rival Deliveroo

LONDON, Aug. 9 (Reuters) – Germany’s Delivery Hero (DHER.DE) has taken a 5.09% stake in online food delivery competitor Deliveroo (ROO.L), raising the price of UK stock at its highest since its IPO in March.

Shares of Deliveroo, which disclosed the stake in a stock market notice on Monday, rose 11% to 360 pence. They were priced at 390 pence when it went public.

Shares of Delivery Hero, a component of the German DAX stock index (.GDAXI), fell 1.3% late in the morning in Frankfurt.

The stake was valued at around 284 million pounds (335 million euros) based on Friday’s closing price.

Online food platforms such as Delivery Hero, Deliveroo, Uber Eats, and Just Eat Takeaway.com (TKWY.AS) have benefited from increased demand during pandemic shutdowns, but some analysts are wondering how much this activity will persist. as restaurants reopen.

A race to new markets and early consolidation movements have resulted in a number of cross-holdings in the sector.

Founded in 2011, Delivery Hero is present in some fifty countries around the world, with particular strength in Asia, where it owns the foodpanda brand.

In many countries it offers fast trading, using its riders to deliver groceries, pharmaceuticals, and electronics alongside restaurant food.

In May, it announced its return to the German market, where it competes with Takeaway.com. Read more

Delivery Hero does not operate in Britain – Deliveroo’s largest market – after selling its Hungryhouse business to Just Eat in 2016.

However, after further consolidation in Germany, he owns a 7.4% stake in Just Eat Takeaway.com.

He also owns 37% of Spain’s Glovo, which is considering its own listing in about three years.

Deliveroo is listed with a dual class share structure which gives co-founder and CEO Will Shu the majority of voting rights for three years.

It currently operates in 12 markets, including Australia, Belgium, France, Hong Kong and Italy, but the UK and Ireland account for more than half of its orders by value.

Deliveroo, which reports first half results on Wednesday, did not comment further and Delivery Hero did not immediately respond to a request for comment.

(1 euro = 0.8484 pounds)

Reporting by Paul Sandle and Nadine Schimroszik Editing by David Goodman and Tomasz Janowski

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