Taiwan Blocks Uber's $950 Million Foodpanda Acquisition
Sign up for ARPU: Stay ahead of the curve on tech news.
Uber Technologies Inc.'s plan to acquire Delivery Hero SE's Foodpanda business in Taiwan for $950 million has been blocked by Taiwan's Fair Trade Commission (FTC), reports Bloomberg.
The FTC, citing concerns about reduced competition in the food delivery market, rejected the deal on Wednesday. The commission's vice chairman, Chen Chih-min, stated at a briefing in Taipei that the merger would have resulted in Uber and Foodpanda controlling over 90% of the market, creating a dominant force with limited competitive pressures.
"The merger would lead to far greater disadvantages from competitive restraints compared to the overall economic benefits," Chen said.
Despite Uber's commitment to the Taiwanese market and Delivery Hero's claims that the deal was contingent on regulatory approval, the FTC concluded that potential rivals would find it difficult to challenge the combined entity.
"The combined business would lack competitive pressures, therefore increasing incentives for it to raise prices for consumers and for restaurants," Chen added.
Uber expressed disappointment with the decision but reiterated its commitment to Taiwan's rapidly growing food delivery sector. The company, in a statement, said it would continue to invest in the market but didn't mention any plans to appeal the FTC's decision.
Delivery Hero, based in Berlin, indicated that Uber now has the option to appeal the decision or abandon the acquisition.
The proposed acquisition, initially announced in May, was expected to be completed by the first half of 2025. Had it been successful, it would have ranked among Taiwan's largest non-chip industry mergers, marking Delivery Hero's strategic retreat from the Asian market.
The FTC's decision follows a trend of increased scrutiny of mergers in Taiwan, with the Financial Supervisory Commission recently blocking a multibillion-dollar acquisition in the financial sector.
Despite the regulatory hurdle, Uber emphasized the strategic benefits of the combination, stating that it would have delivered better services for customers and partners, while also benefiting the Taiwanese economy.
Uber and Foodpanda, currently the two leading players in Taiwan's food delivery market, had previously stressed that the acquisition was contingent on regulatory approval.
In their joint announcement in May, the companies highlighted their complementary strengths: Uber's broader network in northern Taiwan and major urban centers complementing Foodpanda's stronger presence in southern Taiwan and smaller cities.