Uber Pays $950 Million for Delivery Hero’s Taiwan Foodpanda Business

Uber is acquiring Delivery Hero’s foodpanda delivery business in Taiwan for $950 million.

The deal, announced Tuesday (May 14), is expected to close in the first half of next year and comes as Delivery Hero has been looking to reduce its operations in Asia.

“Due to its existing presence in Taiwan, Uber is best placed to build upon the significant local operations developed by Delivery Hero and foodpanda over the past years, and invest further into an improved experience for consumers, merchants, and delivery partners,” the companies said in a news release.

After the deal closes, foodpanda’s local consumers, merchants, and delivery partners will move over to Uber Eats, the companies said. Uber and Delivery Hero have also formed a separate agreement that will see Uber purchase $300 million in Delivery Hero shares.

The acquisition — which the companies claim is the largest such deal in Taiwan history outside of the semiconductor industry — will offer consumers more choice in terms of food types and price points by combining Uber Eats and foodpanda merchants into one platform, per the announcement.

“For example, consumers stand to benefit from the combination of Uber’s wider selection across northern Taiwan and in major urban centers with foodpanda’s comparative strength in southern Taiwan and in smaller cities,” the release said.

“Better service for consumers helps drive more orders from merchants, and more orders from merchants means more opportunities for delivery partners to earn.”

The announcement comes three months after Berlin-based Delivery Hero announced it had called off discussions to sell its foodpanda operations in several other Asian countries: Singapore, Malaysia, the Philippines, Thailand, Cambodia, Myanmar and Laos.

Weeks earlier, the company, which acquired foodpanda in 2016, had been confident the deal would close.

“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,” the company said. “However, Delivery Hero took the decision to withdraw from negotiations as this is no longer the case.”

Meanwhile, PYMNTS last week examined Uber Eats’ recent partnership with Instacart, noting that it could meet the needs of the many consumers who “want to be able to get their restaurant and grocery needs met from a single, unified digital platform that facilitates a wider range of their daily activities.”

The PYMNTS Intelligence study “Consumer Interest in an Everyday App” found that 35% of U.S. consumers showed a strong desire for an everyday app, with 69% saying they’d want to buy groceries from such an app, and 65% wishing to make purchases from restaurants.