The rumors are confirmed! Glovo has just passed into the hands of Delivery Hero, with a presence in 50 countries, after the shareholders’ meeting approved the transaction this Monday. It is an operation that, a priori, doesn’t seem to be very profitable for those who have shares in the Spanish company, since in less than six months the value agreed for the sale has been reduced to less than half.
The fact is that Delivery Hero agreed last January to purchase Glovo, within a operation valued at 2,300 million euros. But this amount would not be paid in money as such, but in a number of fixed shares of the German firm for each share of the Spanish. And to set that figure, the price that the Delivery Hero titles had at that time (around 98 euros) was taken as a reference. a value that has now plummeted up to 35 euros.
And all this has happened in less than half a year. A unprecedented setback which, according to El Confidencial, would have been made effective because the purchase agreement did not include a minimum sale price clause that would protect the sellers from a possible collapse of the Teutonic company’s shares.
At this point, Glovo shareholders will have to decide whether to opt for sell down your new holdings of the Delivery Hero food delivery company or prefer to wait for the situation to rise until it approaches the figures from the beginning of the year.
Regarding the structure and internal organization, there will not be many changes. The same direction is maintained and Glovo will maintain its brand, its own platform and will continue to be directed by its two founders, Oscar Pierre and Sacha Michaudwho remain as shareholders of Glovo with approximately 6% of the shares.
But the Delivery Hero stock drop, of approximately 65%, has not been the only bad news that the delivery giant has had to face these days. And it is that, for the Government of Spain to give its authorization to the transaction, the Germans have had to commit in writing to compliance with the Rider Law, something that Glovo has not done to date.
On the other hand, Delivery Hero also had to take a hard hit as a result of the publication of a British bank HSBC report in which the purchase of Glovo was described as “bizarre and without much business sense”, due to the financial situation that Spaniards are going through, which have been in the red for years and are only sustained by continuous rounds of financing. In fact, according to said report, 475 million euros were lost in 2021 and they have already anticipated that in 2022 there will be operating losses of 330 million euros.
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