(Reuters) -Taiwan has blocked Uber Technologies (NYSE:)’ $950 million purchase of Delivery Hero’s Foodpanda business on the island because of concerns it would be anti-competitive, the Fair Trade Commission (FTC) said on Wednesday.
Uber and Foodpanda did not immediately respond to requests for comment outside regular business hours.
Delivery Hero said in a statement Uber may either appeal the commission’s decision or terminate the acquisition.
In a media briefing, the commission said the merger’s negative impact would outweigh the overall economic benefits, and corrective measures would not be able to address the competition concerns.
“In the food delivery platform market, UberEats’ main competitive pressure comes from Foodpanda. The merger would eliminate this competitive pressure,” Chen Chih-min, vice chairman of Taiwan’s FTC, said.
“Post-merger, UberEats would be less constrained by competition, giving it more incentive to raise prices for consumers and even increase commissions for restaurant operators.”
Chen added that post-merger, the combined market share of both companies in Taiwan would exceed 90%.
Uber and Delivery Hero announced in May the Taiwan deal that included a separate agreement for Uber to purchase $300 million worth of newly issued shares of the German food delivery firm.
The U.S. company expected the acquisition to contribute at least $150 million annually to the adjusted core profit of its delivery business within a year of the deal’s closing, which was seen likely in the first half of 2025.
Online food delivery platforms represent a small fraction of Taiwan’s competitive food delivery market. Foodpanda’s operations on the island were break-even in terms of adjusted core earnings for the 12 months ended March 31, 2024, the companies said.
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