Delivery Hero gets more time to sell Yogiyo
The Fair Trade Commission (FTC) on Thursday said it would extend the deadline on the sale of Yogiyo to Jan. 2 as current circumstances made it difficult to meet the initial deadline of Aug. 2.
The FTC said a company can make a single such request for a six-month extension.
In February, Delivery Hero agreed to sell Yogiyo, the second largest online food delivery in Korea, in exchange for permission to acquire the largest such company, Woowa Brothers, which operates Baedal Minjok, commonly known as Baemin.
In December 2019, the Germany-based delivery behemoth announced it was buying Baemin for $4 billion.
Owning both Baemin and Yogiyo would give it too much control of the market, the FTC decided.
While the market shares of both Baemin and Yogiyo have sagged recently, they still command a combined share of about 80 percent.
The declines are a result of intensifying competition from Coupang Eats, which is now the third-largest food delivery service with a market share estimated at around 18 percent.
It has been reported in local media that Delivery Hero has been struggling to find buyers for Yogiyo, and local retail giants Shinsegae and Lotte have shown little interest.
An earlier deadline for bids for Yogiyo was June 17.
Shinsegae lost interest after it acquired eBay Korea for 3.44 trillion won ($3 billion) in June, becoming one of the top e-commerce companies in the country.
On June 30, Shinsegae announced that it decided not to bid for Yogiyo.
Delivery Hero was reported to be asking 2 trillion won for Yogiyo.
The food delivery market has been enjoying a significant expansion thanks to social distancing regulations, which forced many people to eat at home.
Last year the delivery market was estimated to be worth roughly 15 trillion won, a 150 percent increase from a year earlier.
BY LEE HO-JEONG [email@example.com]