The Competitions and Markets Authority (CMA), the UK’s competition watchdog, on Friday issued an initial enforcement order telling e-commerce and internet group Amazon to halt its investment in UK-based online food ordering service Deliveroo.
Amazon was set to lead a $575m series G round in Deliveroo, announced in May 2019. The round is set to feature investment and financial services group Fidelity Management and Research, asset management firm T. Rowe Price and investment firm Greenoaks Capital.
Founded in 2013, Deliveroo operates a food delivery service across more than 500 cities and towns in 14 countries in Europe, East Asia, the Middle East and Australia. The food is picked up from local restaurants and typically delivered by bicycle.
Amazon’s investment would give it a minority stake in the business, but the CMA has voiced concerns that the two companies would it indeed remain separate entities. If the regulator’s investigation concludes these “reasonable doubts” are correct, it could block the deal.
Amazon had previously tried to enter the food delivery space with its own service, but a month ago announced it was shutting down that operation in the US after having closed it already in the UK last year.
Deliveroo had obtained $957m before the series G round, including $275m in series E funding in 2016 co-led by Bridgepoint, DST Global and General Catalyst.
Greenoaks and Nokia Growth Partners, prior to its spinoit from communications technology producer Nokia into NGP Capital, also participated in the series E round.
Fidelity Management & Research and T. Rowe Price subsequently co-led a $482m series F round in 2017 that also featured DST Global, General Catalyst, Index Ventures, Accel and assorted private investors.
Deliveroo’s shareholders also include Hummingbird Ventures, which backed a $100m series D round in 2015 together with Accel, Index Ventures, Greenoaks and DST Global.
