Uber Technologies has agreed to pay $950 million in cash to Delivery Hero for the Taiwanese company Foodpanda. The transaction is expected to conclude in the first half of 2025, subject to normal conditions and regulatory approval.
Delivery Hero will continue operating Foodpanda in Taiwan until then. This acquisition is one of Taiwan’s biggest-ever overseas transactions.
Uber plans to invest an additional $300 million in freshly issued Delivery Hero shares. Following the transaction’s completion, Uber Eats, the company’s food delivery service will replace Foodpanda for local customers, merchants, and delivery partners. The united app will include products from both businesses.
“The strength of our Taiwanese business is a testament to the hard work of many teams over the last eight years. In order to build a world-leading service, we have come to the conclusion that we need to focus our resources on other parts of our global footprint, where we feel we can have the largest impact for customers, vendors and riders. This deal gives foodpanda an exciting runway in Taiwan and we wish them all the best in their next chapter.”
— Niklas Östberg, CEO and Co-Founder of Delivery Hero
Uber should develop its food delivery operation in Asia, considering its obstacles in the ridesharing space, particularly in the US and Latin America. Uber’s delivery service kept the business solvent during the pandemic when trip volumes were low. The demand for internet meal orders is still high today.
Uber’s worldwide experience running a high-efficiency marketplace will be combined with Foodpanda’s broad reach throughout Taiwan and its connections to well-known local brands in this arrangement.
“Bringing together our distinct customer bases, merchant selections, and geographic footprints will allow us to deliver more choices and the best prices for consumers, stronger demand for restaurants, and more earnings opportunities for delivery partners. Taiwan is a fiercely competitive market, where online food delivery platforms today still represent just a small part of the food delivery landscape. We’re so excited about the opportunity to deliver even greater convenience and value that this transaction would unlock in the years ahead.”
— Pierre-Dimitri Gore-Coty, Senior Vice President of Delivery at Uber
The agreement will also provide customers with more options in terms of food varieties and price ranges. It will combine the complimentary merchant groups on Foodpanda and Uber Eats onto a single platform.
Customers will gain, for instance, from the combination of Foodpanda’s comparative strength in southern Taiwan and smaller cities with Uber’s greater selection throughout northern Taiwan and large urban centers.
Improved customer experience encourages merchants to place more orders, which increases the opportunity for delivery partners to make money.
Why is Uber Doing This: Uber’s Asia Focus Strategies
Now that you know about the deal and what the owners and CEOs have to say about it, let us take a look at it from what this deal means for the two countries— from a political and socio-economic angle.
Online meal orders were the main factor in its success. Uber wants to increase its clout in the Asian food delivery market by acquiring Foodpanda in Taiwan.
- Business diplomacy: Uber is indicating its interest in the Taiwan market with this action. It’s a type of corporate diplomacy.
- Taiwan-U.S. Relations: Uber’s investment in Taiwan as a U.S. firm may have an effect on these relations.
- Local Politics: Taiwanese lawmakers may talk about how the agreement will affect consumer rights, local companies, and jobs.
Why It Matters Politically:
Firstly, one of Taiwan’s biggest international acquisitions, this one demonstrates the country’s attractiveness to businesses and investors. Additionally, Uber’s financial commitment demonstrates faith in Taiwan’s economy.
It might strengthen regional companies and create jobs. The transaction requires regulatory approval, which requires government choices. This process may impact the corporations’ relationships with the Taiwanese government.
Customers will have additional meal alternatives thanks to the merger of Foodpanda and Uber Eats. This might affect the general consensus and level of satisfaction. Moreover, delivery partners profit more when there are more orders. Politicians and voters are concerned about their well-being.
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