Delivery Hero Hit by $376 Million Fine for Glovo Cartel

Delivery Hero SE agreed to pay a total of €329 million ($376 million) to settle a European Union probe into collusion with Glovo before it sealed a takeover of its Spanish rival.

The European Commission announced the penalty on Monday, saying the pair had previously plotted to carve up takeout delivery markets in Europe, shared sensitive commercial information on WhatsApp messages and also agreed to avoid poaching each other’s staff.

The watchdog said the illegal behavior occurred between July 2018 and July 2022, when Delivery Hero gained full control of Glovo, and collusion between the then- separate firms stopped.

“This case is important because these practices were facilitated through an anticompetitive use of Delivery Hero’s minority stake in Glovo,” EU antitrust chief Teresa Ribera said in a statement. “It is also the first time the commission is sanctioning a no-poach agreement, where companies stop competing for the best talent and reduce opportunities for workers.”

The EU’s escalation follows on from raids on company premises in Berlin and Barcelona in 2022 and 2023. The probe came as the food delivery industry was grappling with high competition and thin profit margins after the pandemic — with takeout orders declining as more people turned to restaurants following lockdowns.

Berlin-based Delivery Hero previously told investors that it was expecting an EU antitrust fine possibly exceeding €400 million. The eventual penalty for Delivery Hero’s behavior amounted to about €223.3 million; while Glovo’s share is nearly €106 million. The commission said it cut the levies by 10% because the duo had admitted wrongdoing and agreed to settle. Penalties for antitrust violations can be as high as 10% of a company’s global revenue, although they seldom reach that level.

The final settlement “is nearly 20% lower than anticipated, and reflects, among other things, that the commission acknowledged a lower intensity of the issues investigated for some periods,” Delivery Hero said in a statement after the announcement.

The company’s shares increased 0.8% to €24.57 at 1:42 p.m. in Frankfurt trading as its peers declined.

In its investigation, the commission said the firms had exchanged information about a wide range of activities including on pricing. Their market sharing removed existing overlaps and avoided creating new ones, according to the EU’s antitrust arm. Delivery Hero’s then-minority shareholding provided it with key tool to coordinate with Glovo, the EU said. Their shareholding agreement included no-hire clauses and provided seats on Glovo’s board, according to the regulator.

The Brussels-based commission has historically taken a tough stance on firms found to be carving up parts of the supposedly single EU market to make higher profits by charging different prices and curbing competition in different regions.

The regulator has similarly boosted its enforcement of the bloc’s cartel rules in several headline cases, including continent-wide raids against some of the world’s leading tire companies.

Top photo: Food couriers working for Glovo on a street in Palma de Mallorca. Photographer: Andrey Rudakov/Bloomberg.