Negotiations to sell part of the Foodpanda business in Southeast Asia have failed after the parties could not reach a final agreement on deal terms, according to the German food delivery group Delivery Hero.
The company had confirmed on Feb 2 that talks to sell the business in Thailand, Singapore, Malaysia, the Philippines and other countries were continuing. Those discussions have now ended, Delivery Hero said on Wednesday.
It did not identify the prospective buyer but earlier reports indicated that Singapore-based rival Grab was the suitor. Meituan of China was also said to be exploring a potential acquisition of Foodpanda to give itself a footprint in Southeast Asia.
New York-listed Grab in November reported its first-ever profit on an adjusted basis, a milestone for the decade-old ride-hailing and food delivery company trying to convince investors of its earnings potential.
Business in Asia, Delivery Hero’s largest market, has stagnated since pandemic-era lockdowns eased. In September, the company said it was in talks to sell the Foodpanda brand in some countries in Asia without naming potential buyers.
The company’s shares were down 7% in Frankfurt trading on Thursday. The stock has declined 14% this year.
Delivery Hero CEO Niklas Oestberg said in a press release that the decision to terminate negotiations was taken with “careful consideration” after the Asian business showed strength in the final quarters of last year.
Oestberg said earlier that while Asia was lagging about a year behind other regions in rebounding from a post-Covid slump, he sees the growth pattern normalising to pre-pandemic levels.
“Now we can run it without it being a heavy drag down on our profitability,” he told Bloomberg at the time.