By Steve Goldstein
The food delivery sector was crushed again on Monday, on expectations the European Commission will mandate new rules that will see workers treated as employees rather than contractors.
Deliveroo /zigman2/quotes/225812915/delayed UK:ROO -5.52% fell 8%, as Delivery Hero /zigman2/quotes/208380525/delayed XE:DHER -5.55% and Just Eat Takeaway.com /zigman2/quotes/201653805/delayed NL:TKWY -4.44% /zigman2/quotes/214569449/composite GRUB -3.72% each fell 6%.
Analysts at Citi said Deliveroo would be most impacted by the rule proposal, which the Financial Times reported could be as announced as early as Wednesday. They said Deliveroo’s gross profit would be hit by between 12% and 18%. Delivery Hero’s limited European exposure implied a profit hit of 2% and 3%, and a majority of Just Takeaway’s European riders are already employed, the analysts added.
The broader Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP -1.84% was trading higher on Monday, as oil price gains buoyed energy producers including TotalEnergies /zigman2/quotes/206172043/delayed FR:TTE -2.09% and Royal Dutch Shell /zigman2/quotes/204253697/delayed UK:RDSB -1.67% .