(Reuters) – Taiwan has blocked Uber Technologies’ (NYSE:) $950 million purchase of Delivery Hero’s Foodpanda business on the island over concerns it could be anti-competitive, the Fair Trade Commission (FTC) said ) on Wednesday with.
Uber and Foodpanda did not immediately respond to requests for comment outside of regular business hours.
Delivery Hero said in a statement that Uber could either appeal the commission’s decision or terminate the acquisition.
In a media briefing, the Commission stated that the negative effects of the merger would outweigh the overall economic benefits and that corrective measures would not be able to address the competition concerns.
“In the food delivery platform market, UberEats’ biggest competitive challenge comes from Foodpanda. The merger would eliminate these competitive pressures,” said Chen Chih-min, vice chairman of the Taiwan FTC.
“After the merger, UberEats would be less constrained by competition, providing more incentives to raise prices for consumers and even higher commissions for restaurant operators.”
Chen added that after the merger, the combined market share of both companies in Taiwan would be over 90%.
Uber and Delivery Hero announced the Taiwan deal in May, which included a separate agreement for Uber to buy $300 million worth of newly issued shares in the German food delivery company.
The U.S. company expected the acquisition to add at least $150 million annually to adjusted core profit of its delivery business within a year of the transaction closing, which was expected to occur in the first half of 2025.
Online food delivery platforms make up a small portion of the competitive food delivery market in Taiwan. Foodpanda’s operations on the island were balanced in terms of adjusted core revenues for the 12 months ended March 31, 2024, the companies said.
