Will 'Yogiyo' Be Up for Sale... Delivery Market on the 'Calm Before the Storm'

Portal and Major Distribution Companies Mentioned as Acquisition Candidates... Big Deal with Baemin Falls Through if DH Refuses

[Asia Economy Reporter Kim Cheol-hyun] Attention is focused on the impact on the delivery market as the Fair Trade Commission (FTC) has finally proposed the sale of Delivery Hero Korea (DHK) as a condition for the merger and acquisition (M&A) between Woowa Brothers, operator of Baedal Minjok (Baemin), and Delivery Hero’s Yogiyo. The FTC’s condition is that to acquire Baemin, Yogiyo must be sold. Whether DH accepts this and puts Yogiyo on the market or rejects it causing the M&A to fall through, both scenarios are expected to have a significant impact on the market.

On the 28th, Delivery Hero Korea stated that it is currently waiting for the headquarters’ (DH) position regarding the FTC’s decision. If DH agrees to the FTC’s condition, Yogiyo must find a new owner within six months. Considering the market share of Yogiyo and Baedaltong operated by DHK, the acquiring company could immediately become the second largest in the market. Industry insiders expect Yogiyo’s value to exceed 1 trillion won, given that Baemin’s value in this M&A reached 4.8 trillion won and the number of delivery app users surged this year due to the impact of the novel coronavirus disease (COVID-19). Finding a suitable acquisition candidate is key. Potential buyers could include large distribution conglomerates, portal companies such as Naver and Kakao that have recently intensified their entry into the delivery market, and latecomer delivery app Coupang.

However, the industry analyzes that DH will find it difficult to easily accept the FTC’s condition. In this case, the acquisition of Baemin, which attracted attention as the largest global investment in a startup, will be canceled. When the FTC decided on conditional approval last month, DH publicly stated that it "does not agree." If DH gives up on acquiring Baemin, it is expected to strengthen Yogiyo’s marketing and expand its market share. An industry official explained, "The competition in the delivery market, which has already heated up due to the rise of latecomers, will become even more intense."

This content was produced with the assistance of AI translation services.