Grab's Major Acquisition#
Grab Holdings announced on Monday that it will purchase Delivery Hero’s foodpanda delivery business in Taiwan for $600 million in cash. This marks Grab's first move beyond Southeast Asia, as it seeks to expand its delivery services. Analysts have pointed out potential risks, including high integration costs and a delay in profit contributions.
Details of the Deal#
The acquisition is an all-cash, debt-free transaction, valued at 0.33 times foodpanda Taiwan’s projected gross merchandise value (GMV) for 2025. The deal is expected to finalize in the second half of 2026, pending regulatory approval. Notably, this price is over 30% lower than the $950 million bid made by Uber Technologies in 2024, which was blocked by regulators.
Financial Projections#
Grab has reiterated its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance for 2026, estimating it will be between $700 million and $720 million. The company expects foodpanda Taiwan to add at least $60 million to its adjusted EBITDA by 2028, contributing to a broader EBITDA target of $1.5 billion over three years.
Market Insights#
Analysts from Jefferies, who maintain a “buy” rating on Grab, view this acquisition as a way for the company to replicate its success in Southeast Asia within Taiwan. They project Grab’s adjusted EBITDA will reach $700 million in 2026 and $1.01 billion in 2027. Barclays analysts estimate that foodpanda Taiwan and Uber Eats share the market almost equally. They also noted Taiwan's economy grew by 9% in 2025, driven by demand for AI and semiconductors.
Future Expectations#
Grab anticipates that integration costs will be significant in the early years, with profitability expected by the end of 2027. The company aims to fully migrate foodpanda services to the Grab app by early 2027, targeting a long-term delivery margin of over 4% in Taiwan.