- Delivery Hero ended talks to sell its Foodpanda business in Southeast Asia.
- Delivery Hero believes in the region’s potential based on 2023 results.
- The company will pursue M&A only with high certainty of closing and shareholder value creation.
Delivery Hero has officially ended negotiations for the sale of its Foodpanda business in select Southeast Asian markets. While the potential buyer remains unnamed, rumors point to Grab being the main party involved.
Why did the Foodpanda sale falter?
Despite initial agreement on “fundamental terms,” talks fell through due to undisclosed discrepancies.
In a statement, Delivery Hero CEO Niklas Östberg emphasized the company’s belief in Asia Pacific’s growth potential. He cited positive financial results from the region in 2023, marking an “inflection point.”
Delivery Hero’s strategic pivot
Although Foodpanda’s sales would have positioned Grab as the unquestionable food delivery leader in Southeast Asia, Delivery Hero now opts for internal growth. The company will prioritize M&A opportunities that “create value to shareholders and have high certainty of closing.”
This decision comes despite Foodpanda’s growth challenges, with its gross merchandise value declining in 2023. However, Delivery Hero’s overall profitability has improved, with positive adjusted EBITDA reported for the past year.
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Delivery Hero will explore strategic expansion routes solely with a strong chance of success and shareholder value creation.
This decision underscores the complex dynamics of the food delivery market, where mergers and acquisitions, though enticing, must align with long-term financial goals.
You can also read the original story in its entirety at https://www.techinasia.com/delivery-hero-aborts-talks-foodpandas-potential-sale
