A deliveryman leaves a Pizza Hut outlet
On October 21, Taiwan's Fair Trade Commission announced that, based on concerns about market competition, it had prohibited Grab from acquiring foodpanda's Taiwan delivery business, a subsidiary of Delivery Hero. This decision represents a significant shift in the consolidation plans for Taiwan's food delivery platform market. (Image illustrative of a delivery service.)

The Taiwan Fair Trade Commission announced on Oct. 21 that it had blocked Grab, the Southeast Asian ride-hailing and food delivery platform, from acquiring Delivery Hero’s foodpanda food delivery business in Taiwan, saying the deal could harm market competition and that commitments proposed by the companies did not alleviate its concerns.

According to Reuters in a report dated Oct. 21, Grab announced in March that it planned to acquire foodpanda’s Taiwan business for US$600 million in cash. The deal was intended to be a major step in Grab’s expansion of its regional food delivery operations and was seen as a landmark transaction that could significantly reshape Taiwan’s food delivery market.

The commission said the potential harm to competition from the deal would outweigh its broader economic benefits. It also said the commitments proposed by the two sides were insufficient to eliminate the competition concerns, and therefore decided to block the acquisition.

Grab said it was disappointed by the decision but added that its core Southeast Asian businesses remained resilient and that it would continue pursuing its existing growth plans. Delivery Hero said that, under the terms of the deal, it was entitled to appropriate transaction protections, including termination fee arrangements applicable under certain conditions.

The food delivery platform market involves issues including prices for consumers, commissions charged to merchants, job opportunities for delivery workers and the range of platform services available. A merger between major platforms could bring greater operational efficiency and economies of scale, but it could also reduce the number of market participants, potentially affecting merchants’ bargaining power and consumers’ choices. The commission’s decision highlights the importance it places on competition concerns when reviewing mergers and acquisitions.

It remains to be seen whether Grab and Delivery Hero will pursue further legal or commercial arrangements after the deal was blocked. In Taiwan’s food delivery market, the competitive landscape may remain largely unchanged in the short term, while operators could continue competing through promotions, membership programs, partnerships with merchants and greater logistics efficiency.