KUALA LUMPUR: Delivery Hero SE has terminated discussions to sell its foodpanda business in selected Southeast Asian (SE) markets, confirming a Business Times' report.
On Feb 2, 2024, Business Times reported that a deal between Grab Holdings Ltd and Delivery Hero on the sale of foodpanda business in SE had fallen through due to pricing concerns.
At the time Delivery Hero denied the report stating that negotiations for the potential sale were still ongoing, without specifying parties to the deal.
In a statement dated Feb 21, 2024, the Berlin-based company announced that it has terminated discussions with the main negotiating counterpart on the potential sale, without naming any parties.
"When reconfirming ongoing discussions on Feb 2, 2024, Delivery Hero remained optimistic that it would reach agreeable terms for signing with the main negotiating counterpart. "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. "However, Delivery Hero took the decision to withdraw from negotiations as this is no longer the case," it said.
Its SE markets cover Singapore, Malaysia, the Philippines, Thailand, Cambodia, Myanmar and Laos.
Delivery Hero chief executive officer and co-founder Niklas Östberg said the strength of the company's APAC business was evident during the last quarters as the region reached an inflection point in 2023.
"We believe the region remains strongly positioned to drive profitable growth at scale. The decision to terminate negotiations after months of discussions was taken after careful consideration," he said.
The company noted it remains open to mergers and acquisitions (M&A) and will continue to assess potential strategic alternatives.
However, it said it will only proceed with negotiations where it can create value for shareholders with high certainty of closing.
Delivery Hero's FY 2024 guidance, provided with its fourth quarter 2023 Trading Update, excludes any M&A activities.
Consequently, this announcement does not have any impact on the company's guidance it set out for 2024 or its Free Cash Flow expectations for the medium term," it added.
News on the sale first came to light when German's Wirtschaftswoche business magazine reported in September 2023 that Grab was the potential buyer for foodpanda's business in the region and could fork out more than one billion euro to acquire the online food and grocery delivery platform in all seven markets.