Grab wanted Taiwan to be its first market outside Southeast Asia. Taiwan’s competition regulator has told it, in effect, that it is not really an outsider.

Taiwan’s Fair Trade Commission (TFTC) on Wednesday blocked Germany-based Delivery Hero’s planned sale of foodpanda’s Taiwan business to Grab, scuttling a US$600 million all-cash deal agreed on March 23. The commission said it had discussed possible remedies with the parties, but the commitments on offer were not enough to offset the damage to competition.

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Delivery Hero said the decision does not affect its right to appeal. Grab said it was disappointed, arguing the ruling stops it from bringing new services, better earning opportunities and improved service standards to Taiwanese consumers, couriers and merchants. It added, a little pointedly, that its core business across Southeast Asia “remains robust”.

This is the second time in under two years that Taipei has stopped foodpanda Taiwan from changing hands. In December 2024, the regulator blocked Uber’s roughly US$950 million bid for the same business because the combined entity would have controlled more than 90 per cent of the market. Grab’s bid was meant to be the antidote: an entrant with no Taiwanese operations, buying foodpanda to keep the island’s two-horse race alive. When the deal was announced, e27 argued it could save Taiwan from a delivery monopoly. The TFTC has concluded that the two horses would share a stable owner.

Uber in the room

That owner is Uber. The US company holds about 13.1 per cent of Grab, a legacy of the 2018 deal in which Grab swallowed Uber’s Southeast Asian business, and an Uber executive previously sat on Grab’s board. Grab’s dual-class share structure caps Uber’s voting power at 3.9 per cent, but the commission was unmoved.

Its reasoning runs on four tracks:

1. Uber would pocket a slice of Grab’s profits, which blunts Uber Eats’s incentive to undercut a Grab-owned foodpanda with cheaper fees or promotions.
2. The shareholding changes Grab’s own incentives, voting caps notwithstanding: it is hard to wage a price war on a company that owns a chunk of you.
3. The two companies have worked closely together in other markets, which the TFTC said makes coordination easier to predict and sustain.
4. Taiwan’s delivery market is difficult to break into, because a newcomer needs deep pockets and enough restaurants, couriers and customers all at once, leaving little room for anyone to punish a comfortable duopoly.

The third point is the sharpest. The commission singled out the 2018 Grab-Uber transaction, saying both parties knew or should have known it broke competition law. That is not a speculative charge. Singapore’s competition watchdog fined the two companies a combined S$13 million (about US$9.5 million) over that merger. Taipei has effectively entered that history into evidence, and it said Uber would need to cut its Grab stake further, or exit altogether, to ease the risks.

The Delivery Hero twist

There is also a complication the four points do not spell out. In July, Uber agreed to buy Delivery Hero itself in a deal valuing the German group at about US$14.8 billion, on top of the roughly 25 per cent stake it already held. Taiwan was carved out of that transaction, but the TFTC had already asked Uber whether owning Delivery Hero could still give it influence over the foodpanda sale.

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Strip it down and the picture is awkward. The seller is about to become Uber’s subsidiary. The buyer counts Uber as a major shareholder. The incumbent rival is Uber Eats. A regulator that had already said no to Uber once was never going to be relaxed about a deal in which Uber sat, in some form, on every side of the table.

Local opposition did not help. A lawmaker and delivery workers urged the commission to reject the deal outright, calling it a “de facto monopoly”. The National Delivery Union cited a government-funded Institute for Information Industry study that ranked Grab last among five potential buyers. Critics also flagged Grab’s use of Huawei mapping services, a concern outside the TFTC’s competition remit, but hardly a tailwind in Taipei.

What foodpanda Taiwan is worth, and to whom

The prize is substantial. Foodpanda has operated in Taiwan for about 12 years, with 3-4 million users and 100,000 merchants, and generated US$1.8 billion in gross merchandise value last year. The deal would have handed Grab just over 50 per cent of the market and a presence in 21 cities.

For Grab, the setback is strategic rather than financial. The company has been on a buying spree, from the US$425 million Stash acquisition to its move on Atome, and Taiwan was supposed to prove that the playbook honed across its eight Southeast Asian markets could travel. That proof must now wait. Investors who have questioned the quality of Grab’s profits may not mourn a US$600 million cheque that stays in the bank.

For Delivery Hero, the options are narrowing. An appeal is one route. A third buyer is another, but it would need to be a well-funded operator with no Uber ties. Meituan’s Keeta, which overtook foodpanda in Hong Kong within 29 months of launching, is the obvious candidate, although a Chinese-owned platform would face political headwinds of its own in Taiwan. Asked whether foodpanda might simply leave the island, a TFTC official called the question hypothetical.

The Southeast Asian mirror

Southeast Asian founders and investors should watch closely, because the Taiwan ruling previews questions closer to home. If Uber’s Delivery Hero deal closes, foodpanda’s operations in markets such as Singapore, Malaysia and the Philippines would fall under Uber’s roof. That would put Uber back in direct competition with the company it sold its regional business to in 2018, while remaining one of that company’s biggest shareholders. Regulators in the region will have to decide whether that counts as rivalry or a family dinner.

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And with Grab-GoTo merger talk resurfacing every few months, Taipei has shown that Asian competition authorities are now willing to look past market-share tables to the cap table.

Grab chose Taiwan to prove it could grow beyond Southeast Asia. Its biggest obstacle turned out to be the shareholder it inherited from its most famous deal.

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