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Delivery Hero Given Conditional Approval in $4B Woowa Takeover – Report
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Delivery Hero Given Conditional Approval in $4B Woowa Takeover – Report

Delivery Hero has been told by South Korea’s antitrust regulator that approval for its $4 billion takeover of Woowa Brothers will only be given if it sells its Yogiyo subsidiary within six months, according to Reuters.

Delivery Hero (ORTC) agreed to buy Woowa, Korea’s top food delivery app, last year as it expands into Asia.

The Korea Fair Trade Commission (KFTC) said that if the unit was not sold, the combined market share resulting from the takeover would be 97% of food delivery transactions, giving it a near monopoly in the food delivery market.

KFTC chairperson, Joh Sung-wook, said in a briefing that the sale of Yogiyo, the country’s No. 2 food delivery app, would ease concerns that consumers will end up paying more under the current deal.

South Korea’s food delivery market is expected to grow to around $15.4 billion, making it the fastest growing food delivery market in Asia, and the third biggest globally after China and the U.S. (See UK:ORTC stock analysis on TipRanks)

Jefferies analyst Giles Thorne reiterated his Buy rating on the stock four days ago, setting a price target of €130 (10% upside potential). Thorne stated that approval by the South Korean authorities for the acquisition of Woowa seemed imminent.

Consensus among analysts is a Strong Buy based on 10 Buys and 2 Holds. The average price target of €121.40 implies upside potential of around 3% over the next 12 months.

Delivery Hero’s shares are up around 74% year-to-date, and 270% over the past three years.

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