Last September, German food delivery service platform, Delivery Hero, was reportedly considering selling off its foodpanda business in the Southeast Asia region. At the time, there was talk of several interested buyers, including competitor and fellow food delivery service Grab.
Well, half a year later, Delivery Hero has shared an update on foodpanda’s potential future. Unfortunately, the situation has changed drastically as reportedly, there’s been a failure in negotiations with potential buyers.
On 21st February, Delivery Hero announced in a statement that they were terminating discussions to sell its foodpanda business in selected Southeast Asian markets. According to FMT, the company stated: “The negotiations for the aforementioned potential sale terminated as the parties could not reach final agreement on the deal terms.” The name of said party was not mentioned, however, it is believed to have been Grab.
Earlier in February, Delivery Hero had confirmed that there were ongoing negotiations with a potential buyer, allegedly Grab. According to NST, the parties were attempting to settle the pricing for the deal, as Grab felt the sum asked was “too high”. “At that time, the company believed it had reached an alignment with the potential buyer on the fundamental terms regarding the sale of the business,” they stated. “However, Delivery Hero took the decision to withdraw from negotiations as this is no longer the case.”
CEO and co-founder of Delivery Hero, Niklas Östberg, also shared another reason for terminating negotiations. “We believe the region remains strongly positioned to drive profitable growth at scale,” he shared, adding that the company had been demonstrating its advantages in the region in the past few quarters after reaching a turning point in 2023.
However, the company notably is still open to mergers and acquisitions and will continue assessing potential strategic alternatives. They also claim they will only proceed with negotiations where value for shareholders can be created with a high certainty of closing.
Well, it seems foodpanda will continue to remain under Delivery Hero for now, and will continue to provide a food delivery alternative for customers. Only time will tell if the situation will change for them in the future.
Sources: China Press, New Straits Times
