Delivery Hero Waives Sale of its Foodpanda Business in Selected South East Asian Markets

As the delivery giant announced, despite intensive negotiations, no final agreement on takeover terms could be reached. The planned sale affected countries including Singapore, Malaysia, Philippines, Thailand, Cambodia, Myanmar, and Laos. Delivery Hero had confirmed ongoing discussions about a possible sale in Southeast Asia already in September of last year. Since then, business in this region has been stagnating due to the lifting of lockdown restrictions associated with the COVID-19 pandemic.

At the Beginning of the Year, Market Rumors Caused Great Uncertainty as Speculation Emerged That the Sales Process Might Have Failed. The Malaysian Newspaper New Straits Times Previously Reported on a Possible Failure of Negotiations. The Reaction from Investors was Accordingly Nervous, with the Stock Initially Suffering Heavy Losses but Later Managing to Record Moderate Gains. Overall, the Share Price Fluctuations of the Past Few Weeks Reflect the Difficult Situation of the Company.

The stock reached a historical low with a bottom of just under 15 euros in February due to speculation and resulting liquidity problems. Now, Delivery Hero has officially confirmed that negotiations over the sale of Foodpanda have been abandoned. This development matches the suspicions already expressed that a deal would not materialize due to differing price expectations. Nevertheless, some traders had been hopeful for an agreement until the very end, as the company's statements had sounded quite optimistic previously.

Finance Chief Emmanuel Thomassin Voiced Concerns About the Company's Debt Burden a Week Ago to the Financial News Agency dpa-AFX. Nevertheless, He Emphasized That Delivery Hero Was Not Under Time Pressure to Sell Foodpanda and That the Company's Liquidity Would Be Sufficient Without This Step. This Was a Response to Investors' Concerns Who Doubted That Own Financial Resources Would Suffice to Service the Debt.

Despite Disappointment Over Failed Talks, UBS Analyst Jo Barnet-Lamb Sees a Significant Strengthening of Confidence in the Value of the Company's Southeast Asia Business Compared to Fourth Quarter Results. These had recently encouraged investors, suggesting a possible revival of the business. An improved gross margin also indicated profitable growth. Barnet-Lamb is confident that Delivery Hero is likely not to rely on external capital to bear the debt burden in the near future.