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Bloomberg
Delivery Hero AG rose as much as 8.6 percent in its first day of trading, giving the Berlin-based takeout company a market capitalization of 4.7 billion euros ($5.3 billion) in a successful debut on the Frankfurt stock exchange.
The food delivery broker, which connects customers and restaurants via its apps, rose as high as 27.70 euros after setting a final offer price of 25.50 euros, the ceiling of its range. “It’s a nice example for other startups in Germany, when there aren’t so many,” said Eric Leupold, head of the IPO department at Deutsche Boerse. “We had Rocket, Zalando, now Delivery Hero. It proves to founders it can work. That’s important.â€
Delivery Hero operates a variety of brands including Lieferheld, Foodora and Foodpanda, through which it either brokers deliveries from restaurants or brings the food to customers’ homes itself, by bicycle. The food delivery sector is notorious for stiff competition, with rivals spending big on marketing to dominate a country because usually, the winner takes all. Delivery Hero is active in 42 markets and partners with about 150,000 restaurants.
The demand for shares in the company, which competes with app-based takeout services including Just Eat Plc, GrubHub Inc. and Takeaway.com, was good news for backer Rocket Internet SE, the Berlin-based startup incubator led by Chief Executive Officer Oliver Samwer that owns about 35 percent of Delivery Hero.
While Delivery Hero may have been an initial success, Rocket’s shares came under pressure from a different kind of food startup: Blue Apron Holdings Inc., a New York-based meal-kit delivery service, had a disappointing debut Thursday. That’s a problem not so much for Delivery Hero, whose main business is brokering orders for restaurants that deliver, but for Rocket Internet’s Hello Fresh, another IPO hopeful that also sends out meal kits and is comparable to Blue Apron.
“The weak debut doesn’t bode well for Rocket’s hope to bring Hello Fresh to the market,†Neil Campling, an analyst at Northern Trust, said in a note to clients. Rocket Internet was down 2.6 percent in Frankfurt trading, its fourth day of losses.
Blue Apron closed unchanged at $10 a share Thursday after its IPO price had already been cut by more than a third to help stoke demand for the shares. Enthusiasm fizzled after Amazon.com Inc. announced it was acquiring grocery chain Whole Foods Market Inc. just days before the IPO. The stock fell 4.2 percent to $9.58 at 10 a.m. Friday in New York.