Deliveroo quits Germany to focus on other markets

FILE PHOTO: A deliveroo worker cycles along a pedestrianised road in Liverpool, Britain, October 18, 2017. Picture taken October 18, 2017. REUTERS/Phil Noble

LONDON (Reuters) - British food delivery service Deliveroo will cease operations in Germany on Friday to focus on other markets in Europe and beyond, a spokesman for the Amazon-backed AMZN.O company said on Monday.

The withdrawal of Deliveroo - which says it has 1,100 riders in five cities and just under 100 employees in Germany - reduces competition for Dutch rival TKWY.AS, which last year agreed to buy larger competitor Delivery Hero's DHER.DE business in the German food delivery market.

Deliveroo's decision comes as and British rival Just Eat JE.L have just finalised the terms of their deal to create a global food delivery company that will be a market leader in Britain, Germany, the Netherlands and Canada.

“We’ve decided to focus on other markets,” a Deliveroo spokesman said regarding Germany, adding the company was not ruling out returning to Europe’s largest economy in the future.

Deliveroo will shift its resources and investment towards boosting growth and expanding in markets around Europe and the Asia-Pacific region, the spokesman said.

He added Deliveroo was growing rapidly in the United Kingdom and France, its top markets, and was aiming by the end of the year to be available to half of the population in the United Kingdom and a third in France.

The company also plans to double the number of cities in which its food delivery service is available in Spain to 60 this year, he said, adding Italy was another growth market.

Deliveroo said “appropriate compensation and goodwill packages” would be available for riders, employees and restaurants.

Reporting by Georgina Prodhan in London and Alexander Huebner in Munich; Writing by Michelle Martin and Tom Sims; Editing by Susan Fenton and Mark Potter