Delivery Hero Faces Hefty EU Antitrust Fine, Shares Plummet

Food delivery giant Delivery Hero, owner of Foodora, is bracing for a potential fine exceeding $440 million from the European Union over alleged antitrust violations. The company disclosed on Sunday that it's under investigation for anti-competitive practices such as market sharing agreements, exchanging sensitive business information, and no-poach agreements with competitors.

This investigation is part of a broader crackdown by EU authorities on potentially unfair practices within the food delivery sector. Delivery Hero has pledged full cooperation with the European Commission but has significantly increased its provision for potential fines. The news sent the company's shares tumbling on Monday.

The potential fine represents a significant blow to Delivery Hero, which operates in over 50 countries worldwide. The company has been aggressively expanding its reach in recent years, fuelled by surging demand for food delivery services during the COVID-19 pandemic. However, this rapid growth has also attracted increased scrutiny from regulators.

The investigation and potential fine raise questions about the sustainability of Delivery Hero's business model and the overall competitive landscape in the food delivery industry. While the company remains optimistic about its future prospects, the outcome of the EU investigation could have far-reaching implications for its operations and profitability.