Delivery Hero has offloaded several of its operations in Central and Eastern Europe to Glovo in a deal worth €170 million.
The Barcelona food delivery firm will acquire Delivery Hero’s Foodpanda business in Romania and Bulgaria, the Donesi brand in Serbia, Montenegro, Bosnia and Herzegovina, and Pauza in Croatia. The deals are currently subject to approval from regulatory authorities.
The deal marks a significant doubling down on the Central and Eastern European and Balkan markets for Glovo.
Earlier this month, it also acquired Slovenian food delivery firm Ehrana for an undisclosed amount.
“[The region has] always been central to our long-term strategy to focus on markets where we see clear opportunities to lead and where we can build a sustainable business,” Glovo chief executive Oscar Pierre said.
“Central and Eastern Europe is a very important part of that plan. The region has really embraced on-demand delivery platforms and we’re very excited to be strengthening our presence and increasing our footprint in countries that continue to show enormous potential for growth.”
It remains to be seen what strategy will be implemented in these markets by Glovo. The company, which raised €450 million earlier this year, has invested heavily in its dark stores business, delivering food, groceries, and other items in rapid time. Pierre previously said it plans to have dark stores in 100 cities by the end of 2021.
For Delivery Hero, it is the latest deal closed with Glovo. Last year it acquired Glovo’s Latin American business for €230 million.
In a statement, Delivery Hero chief executive Niklas Östberg it sold off these various European business units to Glovo to focus on other markets.
“Delivery Hero has built a clear leading business in the Balkan region in the last couple of years. However, with a lot of operational priorities on our plate, we believe Glovo would be better positioned to continue building an amazing experience for our customers in this region,” Östberg said.
Delivery Hero reported revenues of €1.4 billion for the first quarter of the year and expects to double revenues in 2021.