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Uber to buy Foodpanda’s Taiwan division from Delivery Hero for $950 million in cash

Uber Technologies announced On Tuesday, the company announced it would acquire the Taiwan division of Delivery Heroes Foodpanda for $950 million in cash. The partnership is part of Uber Eats’ strategy to expand in Asia, particularly by strengthening its position in Taiwan. On the other hand, it also highlights Delivery Hero’s continued withdrawal from the market. The sale comes at a time when Delivery Hero is looking to divest packages of other businesses across Southeast Asia.

As part of the deal, Uber will also acquire a stake in Delivery Hero. The company will purchase $300 million in newly issued common stock from the Germany-based company, which operates food delivery services around the world.

Uber said the deal is one of its largest cross-border acquisitions from Taiwan and is expected to close in the first half of 2025.

After the store closes, Foodpanda’s local consumers, sellers and delivery partners will transition to Uber Eats, according to the statement.

Uber Eats and FoodPanda dominate Taiwan’s food delivery market. According to recent reportsFrom January 2022 to August 2023, Foodpanda led the market with 52% of the market share, while Uber East had 48%. Other food delivery companiesFoodomo and a number of other fast food delivery apps account for less than 2% and 6% of Taiwan’s market share, respectively.

“Taiwan is a highly competitive market, and online food delivery platforms are still only a small part of the food delivery industry today. We’re very excited,” said Pierre Dimitri Gore-Coty, Uber’s senior vice president of delivery.

Uber said it expects geographic synergies from the partnership. “Uber offers a wider range of options in northern Taiwan and major urban centers, while Foodpanda has relative strength in southern Taiwan and smaller cities,” the paper said.

Taiwan online food delivery The market is projected to reach approximately $68.5 million by 2029up from $51.3 million in 2024.

Food delivery has experienced many ups and downs as a broader market. Unit economics and the struggle to achieve better economies of scale in a competitive market have led to a lot of consolidation, with once globally ambitious players retreating to domestic markets for the time being. .

This played out particularly painfully in the “ready-to-eat” market. When startups go bankrupt or are acquired by larger companies, billions of dollars from many investors can disappear, sometimes for just a dollar. Then, as in the case of Getir in April, those large players themselves downsize.

Bernstein analysts noted that Taiwan has an established food delivery industry across a concentrated landscape, making it an “attractive” market for Uber.

Bernstein’s analysts said, “Top-down, GDP/population levels are good relative to Asia as a whole, and Uber Eats is well-positioned,” with Taiwan’s business funnel particularly strong. It added that the average number of monthly orders per user is seven, compared to three in Taiwan. Bernstein said he’s five times more than normal in the delivery market. It also means leading member contributions in gross bookings.

Meanwhile, Delivery Hero said it plans to focus its Foodpanda business on other markets.

Niklas Östberg, CEO and co-founder of Delivery Hero, said: “Our conclusion is that in order to build a world-leading service, we need to focus our resources on other parts of our global footprint where we believe we can have the greatest impact on our customers, vendors and passengers. This agreement gives Foodpanda an exciting runway in Taiwan and we wish them every success in their next chapter.”

In February, Delivery Hero plans to downsize its business in Asia. Finished negotiations with undisclosed third party regarding potential sale foodpanda’s services in selected Southeast Asian markets (Singapore, Malaysia, Philippines, Thailand, Cambodia, Myanmar and Laos). Delivery Hero’s food delivery division competes with Grab in Southeast Asia. Negotiations for the partial sale of Foodpanda broke down due to the following circumstances. September layoffsaimed at streamlining business operations.


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