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Uber to Acquire Delivery Hero's Foodpanda Business in Taiwan for $950 Million

Uber to Acquire Delivery Hero’s Foodpanda Business in Taiwan for $950 Million

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In a strategic move that could potentially reshape Taiwan’s food delivery industry, Uber Technologies has announced its acquisition of the Taiwan business of Foodpanda, owned by Delivery Hero, for a staggering $950 million in cash. The acquisition, subject to regulatory approval, is slated to close in the first half of 2025, marking a significant development in the country’s online food delivery sector.

A Shift in Focus: Delivery Hero's Strategic Decision

Uber to Acquire Delivery Hero's Foodpanda Business in Taiwan for $950 Million

Image Source: investing.com

The decision comes as Delivery Hero, the parent company of Foodpanda, aims to refocus its resources on other global markets where it believes it can make a more substantial impact. Niklas Östberg, co-founder and CEO of Delivery Hero, emphasized this shift, stating, “We need to focus our resources on other parts of our global footprint, where we feel we can have the largest impact for customers, vendors, and riders.”

Uber's Expansion Strategy and Market Dominance

Pierre-Dimitri Gore-Coty, senior vice president of delivery at Uber, highlighted the fiercely competitive nature of Taiwan’s market and expressed optimism about the acquisition’s potential to bolster Uber’s presence. The move is expected to strengthen Uber’s position in a market where online food delivery platforms still represent a small fraction of the overall food delivery landscape.

Foodpanda, a major player in Asia’s online food and grocery delivery sector, operates in several key markets, including Singapore, Malaysia, Thailand, The Philippines, and Hong Kong. The 2016 acquisition of Foodpanda by Germany’s Delivery Hero marked a significant consolidation in the region’s food delivery industry.

Potential Monopoly Concerns and Regulatory Scrutiny

With Foodpanda and Uber Eats dominating Taiwan’s food delivery market, concerns about potential monopolistic practices may arise following the acquisition. Data from Measurable AI underscores Foodpanda’s significant market share, with a 52% share by order volume compared to Uber Eats’ 48%. 

Also Read: US Invests $120 Million in Chipmaker to Expand Facility in Minnesota

The deal, heralded as one of Taiwan’s largest international acquisitions outside the semiconductor chip industry, will undergo thorough regulatory scrutiny before its finalization. This scrutiny is essential to ensure fair competition and consumer protection in Taiwan’s evolving food delivery landscape.

Delivery Hero’s decision to retain its Foodpanda business in Southeast Asia, despite previous talks of selling, underscores the strategic complexities in the region’s delivery sector. The acquisition’s completion and subsequent market dynamics will undoubtedly be closely monitored by industry observers and regulators alike.

Taiwan

US Is Buying Chipmaking Machines From Taiwan More Than Ever

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As the Biden administration seeks to revive the local semiconductor industry, US sales of Taiwanese chip-making gear reached an all-new high record in March. According to information from the Ministry of Finance in Taiwan, the country which is a worldwide hub for silicon manufacturing innovations, witnessed a 42.6 percent increase in its chipmaking equipment exports to the US in March compared to the same month last year, setting an all-time high record of 71.3 million USD (RM314.01 million). However, trade in China went down 33.7 percent, marking the tenth consecutive month of a downward spiral.

Taiwan
Image Source: cnbc.com

Taiwan is a key factor in the worldwide supply chain and residence of Taiwan Semiconductor Manufacturing Co (TSMC) as well as numerous additional key players in the chip industry.

Also Read: Why is Samsung’s cut in chip production good news for industry?

United States officials took action to establish more sophisticated chipmaking within American borders because of concerns over over-dependence on Taiwan island, which China regards as a portion of its own country.

Due to financial aid and assistance from the state and municipal governments, TSMC is building two fabrication facilities in Arizona.

The chip supply chain is beginning to split apart as a result of US measures to restrict China’s access to essential semiconductor equipment, know-how, and goods. One indication of this is the decline in Taiwan’s shipments of semiconductor machines to China.

A month back, Japan also unveiled intentions for new export limits on chip manufacturing equipment, clearly aiming its limitations at China which is the second-largest economy in the world.

Japan’s move to collaborate with the United States and the Netherlands in banning chip manufacturing equipment exports to China has given the allies strong tools to use in the expanding technological conflict.

The commerce ministry of Japan announced this week that beginning in July, exports of 23 different types of chip technology will require government authorization.

This has an impact on a wide range of businesses, which includes Nikon Corp., Tokyo Electron Ltd., and Screen Holdings Co., which have played a key role in China’s efforts to establish a local chip sector.

“Japan joining the export curbs will do great harm to China’s ability to make and develop chips smaller than 16 nanometers,” said Akira Minamikawa, an analyst at research company Omdia.

Source: bloomberg.com

Also Read: U.S. set to further tighten chipmaking exports to China

American businesses like Applied Materials Inc. were immediately impacted by the regulations when the Biden administration published its extensive limits on chip-related shipments to China in October.

Following the announcement that both the Netherlands along with Japan has joined the China restriction, all the main nations that manufacture chipmaking gear are taking part. The most cutting-edge equipment, involving those that produce logic chips at 16 nm or with more complex geometries, are covered by the constraints.

TSMC

Taiwan’s TSMC to recruit 6,000 engineers in 2023

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TSMC is trying to capitalize on the current trend of technical job cuts, which have resulted in the dismissals of several thousand engineers.

“To support the company’s business growth and technology development, TSMC is planning to recruit more than 6,000 new employees in Taiwan including engineers and production line operators in Hsinchu, Taichung, Tainan and Kaohsiung in 2023,” the chip biz told The Register.

Source: theregister.com
tsmc
Image Source: reuters.com

To maintain the wafers running, the corporation states that it intends to hire up to 6,000 engineers, which is about a 10 percent rise in staff numbers. According to Reuters, TSMC is not only searching for pricey skillsets, but also engineers with degrees varying from a two years degree to a doctoral degree in electrical engineering or software development.

Also Read: Germany planning to ban Huawei, ZTE from parts of 5G networks

The catch is that you may be required to emigrate to Taiwan. The provided local wage is substantially lower compared to what you’d anticipate finding in the United States.

According to TSMC, the average wage for a fresh engineer is expected to be approximately NT$2 million, or around $65,500 per annum, but it’s interesting to note that the living expenses in Taiwan are significantly lower. TMSC is also rapidly expanding in the United States, but it will be some time before the new fabs are operational.

“TSMC is recruiting broadly from both experienced professionals and first-time job seekers with backgrounds in electronics, electrical engineering, optoelectronics, mechanical engineering, physics, chemistry, chemical engineering, industrial engineering, financial, accounting, management, human resources, and related fields to come on board. TSMC is also recruiting production line operators. People with senior high school (inclusive) or above including college graduates are welcome to join. The company is open to hiring foreign engineers.”

Source: theregister.com

The hiring spree emanates as the semiconductor industry in its entirety struggles with a slowing global economy and falling chip demand, especially in distribution channels.

Also Read: Twitter Cuts More Engineering, and Product Jobs to Curb Costs

These market factors have had a significant impact on many chipmakers. Samsung which is TSMC’s main competitor in the foundry industry has seen its sales fall to 3.4 billion USD, a 69 percent drop from the previous year in January, whilst also earnings fell 8 percent to 57.3 billion USD.

In contrast, TSMC has carefully eliminated controversy thus far. TSMC confirmed Q4 revenues of 19.93 billion USD which is a 26.7 percent rise compared to the previous year, whereas others reported operational losses and decreasing revenues.