EU Investigates Delivery Hero and Glovo for Antitrust Concerns

The European Commission has initiated a formal investigation into Delivery Hero, a Berlin-based food delivery giant, and its Spanish subsidiary, Glovo, over potential cartel activities. The inquiry will scrutinize agreements between the two companies to determine if they engaged in anticompetitive practices, including the allocation of geographic markets and the sharing of sensitive commercial information prior to Delivery Hero's acquisition of Glovo in July 2022. The Commission is particularly concerned about possible agreements not to poach each other's employees, which may have been facilitated by Delivery Hero's minority stake in Glovo. This investigation follows unannounced raids on the companies' offices in July 2022 and November 2023. The Commission noted that this is the first time it has investigated anti-competitive agreements linked to a minority shareholding in a competitor. Both companies have acknowledged the investigation, with Glovo emphasizing its commitment to cooperate fully with the Commission and comply with regulatory requirements. Delivery Hero has warned investors of a potential antitrust fine of up to €400 million as a result of the ongoing investigation. The food delivery sector has faced significant challenges, including market corrections and increased competition, following a surge in demand during the COVID-19 pandemic. The Commission's investigation is part of a broader trend of antitrust scrutiny in the technology sector, which has seen similar actions against major players like Microsoft and Apple in recent months. As of the end of 2023, Delivery Hero owned 99.2% of Glovo, with a market capitalization of €5.32 billion. The company operates over 307 subsidiaries, with a significant portion of its gross merchandise value derived from Asia.