Delivery Hero surges on report investors pushing for divestments

(Sharecast News) - Delivery Hero shares surged on a report the German food delivery platform is considering selling or divesting parts of its business under pressure from several major shareholders. Investors including Hong Kong hedge fund Aspex Management, which is Delivery Hero's second-biggest shareholder with a stake of more than 5%, are pushing management to consider a sale of the company or parts of its business, the people said.

The pressure comes amid weak stock performance for Delivery Hero, whose shares have fallen 53% over the past year, giving the company a market value of about €5.2bn.

Singapore-based Broad Peak Investment Advisers, Switzerland's PSquared Asset Management and at least one large US fund have separately expressed their frustration with what they saw as Delivery Hero's lack of progress in streamlining its loss-making operations and boosting shareholder value, Bloomberg reported, citing unnamed sources.

Although Delivery Hero has unsuccessfully tried to shed businesses including the sale of its Taiwan unit to Uber Technologies, the investors are calling for a broader strategic approach to trimming its portfolio, the report stated.

Delivery Hero or some of its units could attract interest from competitors like Chinese internet giant Meituan, Singapore's Grab Holdings or Uber if they were put up for sale, the sources added.

Delivery Hero's Korean business Baedal Minjok, which is the country's biggest food delivery app, is among the assets seen as particularly attractive.

Dubai-based asset manager Ajeej Capital, which has a stake in both Delivery Hero and its listed Middle Eastern unit Talabat Holding, has separately expressed concerns about a persistent disconnect between the companies' strong fundamentals and their depressed market valuations, according to the report.

Reporting by Frank Prenesti for Sharecast.com