Deliveroo boss makes light of buyout talk after rival’s swoop

WILL SHU has played down speculation that Deliveroo could be a target for a merger after a larger German rival, Delivery Hero, took a stake in the London-listed company.

The Deliveroo founder and chief executive said the 5.1pc stake, revealed in a filing on Monday, was an “endorsement” of its business but not thought to be part of a wider approach.

“We are a public company – Delivery Hero can buy shares. [Niklas Oestberg, its chief executive] said he thought it was a good longterm investment. We think of it as an endorsement,” Mr Shu said.

Asked if the stake could signal future consolidation among the delivery players, Mr Shu said: “M&A is hard to predict. I would not read too much into what [Delivery Hero] is doing here.”

His comments came as Deliveroo revealed its halfyear results, with total order value on its food delivery app more than doubling. Order value soared by 131pc in the first three months of the year and by 81pc in the second quarter.

Revenues jumped 81pc to £922m and losses narrowed from £128.4m to £104.8m.

Deliveroo said its grocery delivery business, which works with supermarkets including Waitrose, continued to expand and now accounted for 7pc of its total order value.

Shares fell 6.1pc to 341p on its results. Analysts said there was an expectation that customer demand for takeaways would inevitably fall as more people return to eating out across Europe.

Deliveroo shares jumped 5pc on Monday and a further 7pc on Tuesday after Delivery Hero, a €31bn (£26bn) Berlin-based rival, revealed its £300m stake, prompting speculation the British company could become a takeo- ver target. Delivery Hero operates across Europe but lacks a UK presence.

Mr Oestberg said on Monday he believed Deliveroo was undervalued after its disastrous stock market debut in March sent its shares tumbling.

The company priced its shares at 390p, but they closed more than 100p lower on the first day of trading and continued their decline after that.

The stock has since recovered much of that ground but still lags behind the initial optimism.

♦ In grocery delivery, Brit- ain’s takeaway companies will have to contend with a new US rival, Gopuff.

The Philadelphia-based company, valued at $15bn (£10.8bn), confirmed today that it was buying UK startup Dija to expand in Europe.

The deal will give it a pres- ence in so-called “dark stores” in the UK, France and Spain. While Deliveroo offers convenience groceries from Waitrose or Co-op, Gopuff runs its own deliveryonly stores.