International

Delivery Hero To Replace Wirecard On Germany's DAX Index

Germany's blue-chip DAX index will be replacing Wirecard, the disgraced payments company, with a new listing for Berlin's Delivery Hero, the Financial Times (FT) reported.

Like many food delivery companies, Delivery Hero has benefited from a rush of new activity during the pandemic. It hasn't done any significant business in Germany, but since being founded in 2011, it now operates in more than 40 countries across Europe, Latin America, Asia, the Middle East and north Africa, FT reported.

The company raised its full-year revenue guidance in July by around 8 percent, or 200 million euros ($236.9 million). That came with a quadrupling of orders in the company's biggest market, Asia. European sales were also up by around 47 percent.

The company has yet to report a profit, though, and it sold its German brands, including Foodora, Lieferheld and Pizza.de, to competitor Takeaway.com in 2019.

CEO and Co-Founder Niklas Östberg said the inclusion on the DAX index is "an acknowledgment that the capital market believes in our platform," FT reported.

Wirecard had been promoted to the DAX in 2018, replacing Commerzbank.

But since then, the once-celebrated payments company has been mired by global scandal amid an alleged money laundering scheme that sank it into insolvency earlier this year.

The seams started to come apart when irregularities in the company's annual financial report over $2 million in missing money ended up exposing a worldwide scheme. The company said its money was in two banks in the Philippines, but nothing was ever found.

Numerous arrests have been made, including that of CEO Markus Braun and other top executives, but one of them, Jan Marsalek, remains on the run. The scandal has also widened to include regulators and auditors who reportedly looked the other way while financial crimes were committed.

One former executive, Christopher Bauer, was recently reported dead from natural causes after he'd been summoned to testify in the case. He died in a hospital in the Philippines, according to Justice Secretary Menardo Guevarra, PYMNTS reported.

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