Global mobility company Uber is seeking to acquire Delivery Hero SE (DH), which indirectly controls Woowa Brothers, the operator of Baedal Minjok. The Fair Trade Commission (FTC) has initiated a preliminary review of Uber's acquisition of DH to assess its impact on competition in the domestic taxi-hailing and delivery app markets.
On September 22, the FTC announced that it has received a preliminary review application regarding Uber's plan to acquire all shares of DH.
Uber intends to acquire DH shares through a public tender offer. The company aims to complete the acquisition process by November this year, securing more than 50% plus one share of DH, subject to approvals from competition authorities in various countries, with the goal of finalizing the stock acquisition in the second half of next year.
This procedure is a preliminary review, not a final decision on merger approval. It allows the merging company to request the FTC to assess whether the merger would substantially restrict competition before the formal merger notification period. Acquisitions through public tender offers are generally subject to post-reporting requirements.
DH controls Woowa Brothers, which operates Baedal Minjok through its subsidiaries. If the transaction is completed, Uber, which operates taxi services in South Korea, will gain management control over Baedal Minjok.
As of February this year, Uber is the second-largest player in the domestic taxi-hailing platform market based on monthly active users (MAU). In the delivery app market, as of April, Baedal Minjok led with 23.4 million users, followed by Coupang Eats with 13.15 million and Yogiyo with 4.21 million.
The FTC views this merger as a 'mixed merger' between the taxi-hailing platform business and the delivery platform business. Should Uber gain control over Baedal Minjok, there is potential for the integration of taxi-hailing and delivery-related memberships or the expansion of advertising and promotional services across both platforms.
Uber has also highlighted key expected benefits of the transaction, including increased cross-utilization of mobility and delivery services and the expansion of advertising and promotional services for partner merchants.
In response, the FTC plans to closely examine the impact of the merger on the competitive structure of the domestic taxi-hailing and delivery app markets. The review will consider not only the activities of competing businesses but also the choices available to users and partner companies. An FTC official stated, "We plan to conduct a thorough review in accordance with the standards and procedures set forth in the Fair Trade Act."
* This article has been translated by AI.
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