Uber Technologies, Inc. (UBER.US) faces obstacles in its acquisition! Delivery Hero rejects the offer, causing the stock price to soar 10% and surpass the bid.

May 25th, the stock price of German takeaway giant Delivery Hero climbed to 37.85 euros on the Frankfurt Stock Exchange, reaching its highest level in 18 months. This price not only significantly exceeded Uber Technologies, Inc.'s indicative takeover offer of 33 euros per share announced last Saturday, but also approached Uber Technologies, Inc.'s latest "additional bid" of 38 euros per share. The market is sending a clear signal with real gold and silver: any offer below 40 euros per share may not be able to open the doors to Delivery Hero. With the strong intervention of competitors like DoorDash, continued pressure from aggressive shareholders, and the looming shadow of anti-monopoly concerns, a multi-party game around global takeaway map restructuring is intensifying. Bidding Game: From 33 to 40+ On May 23rd (Saturday), Delivery Hero formally confirmed in a regulatory filing that Uber Technologies, Inc. had made a preliminary takeover offer to all shareholders of the company, with a price of 33 euros per share, corresponding to a total enterprise value of approximately 10 billion euros (around 11.6 billion US dollars). This price was even slightly lower than Delivery Hero's closing price of 33.59 euros the previous Friday - in other words, Uber Technologies, Inc.'s initial tender offer did not offer any premium over the previous day's closing price. According to sources familiar with the matter, Uber Technologies, Inc. CEO Dara Khosrowshahi flew to Oslo, Norway earlier this week to meet with Delivery Hero's Chairman of the Supervisory Board, Kristin Skogen Lund, proposing a takeover offer of 33 euros per share in person. However, the market responded tepidly to this offer. Faced with the initial tepid response, Uber Technologies, Inc. quickly escalated the situation. According to three sources, Uber Technologies, Inc. recently proposed a new offer of 38 euros per share to a major shareholder of Delivery Hero, resulting in a total transaction valuation of over 11.5 billion euros (approximately 13.39 billion US dollars), representing a premium of about 15.3% over Delivery Hero's closing price on the previous Friday. However, this increased offer was also rejected. The board of directors of Uber Technologies, Inc. held a meeting on Saturday to evaluate the progress of the acquisition, with sources saying that the company is now "considering raising the bid again." Delivery Hero's shareholders have shown unprecedented unity in this game. Several investors have explicitly stated that they expect the acquisition price to be higher than 40 euros per share. At this price, the total enterprise value of Delivery Hero would reach approximately 13 billion euros. Jefferies Financial Group Inc. analyst Giles Thorne noted in a report that many stakeholders are still insisting on an acquisition price of over 40 euros per share, "predicting the next steps is extremely difficult, especially considering the presence of 'significant antitrust issues'." Barclays PLC Sponsored ADR analyst Andrew Ross provided a more aggressive assessment, suggesting that Delivery Hero's "fair value far exceeds 40 euros," and this can be achieved through a comprehensive acquisition or company split. Jefferies Financial Group Inc. maintains a "buy" rating on Delivery Hero, with a target price of 42.50 euros. Delivery Hero's stock price continued to skyrocket on Monday, rising by approximately 10%, setting a record for the 11th consecutive trading day with gains, and accumulating an 89% increase over the past two weeks. So far in May, the stock has risen by over 80%, moving towards the largest monthly gain in its history. DoorDash Enters the Game: From "Solo Performance" to "Battle of Titans" Competitors make a quiet move If Uber Technologies, Inc.'s initial offer of 33 euros exposed the acquirer's "stinginess," then DoorDash's strong entry changed the game completely. According to reports on May 23rd, Uber Technologies, Inc. and DoorDash have separately made tentative contacts with investors of Delivery Hero for potential acquisitions. DoorDash has not yet acquired any shares of Delivery Hero, but its intentions are clear - primarily targeting Delivery Hero's Middle Eastern businesses, including its platforms Talabat and HungerStation. The appearance of DoorDash has given Delivery Hero's board more options. It is reported that the board is weighing two options: selling the entire company or splitting off its Middle Eastern and Korean businesses. Global Takeaway Competition Landscape The backdrop of this acquisition battle is the deep integration logic of the global takeaway industry entering the era of "stock game". Analysts generally believe that Uber Technologies, Inc.'s aggressive move is primarily driven by the increasing pressure from its biggest competitor DoorDash. Currently, DoorDash holds a 67% share of the domestic takeaway market in the USA, far surpassing Uber Technologies, Inc.'s 25%. What is more concerning for Uber Technologies, Inc. is that DoorDash is expanding its footprint to over 40 international markets through acquisitions like Finland's Wolt and the UK's Deliveroo, establishing a strong foothold in Europe. The value of Delivery Hero lies in its unparalleled global coverage. This Berlin-based takeaway platform operates in approximately 65 countries and regions across Asia, Europe, Latin America, the Middle East, and North Africa, with brands like Foodpanda, Talabat, PedidosYa, among others. Jefferies Financial Group Inc. pointed out in its analysis that "Uber Technologies, Inc. and DoorDash's rumored acquisitions and splits of Delivery Hero highlight the strategic value of these assets and also expose the complexity of such acquisitions." In fact, Uber Technologies, Inc. directly competes with Delivery Hero in 22 markets worldwide, including 9 in Europe; DoorDash overlaps with Delivery Hero in 18 markets, including 14 in Europe. Jefferies Financial Group Inc. proposed that the two competing bidders "joint acquisition, splitting the business as needed, may help bypass some antitrust obstacles, but the complexity and risk of the transaction remain extremely high." What can acquiring Delivery Hero bring to Uber Technologies, Inc.? The European takeaway industry is experiencing an unprecedented wave of consolidation. The European online food delivery market is expected to grow at an annual compound growth rate of 8% from 2025 to 2030. Although the growth rate has slowed down compared to the pandemic period, the market size is continuously expanding. With the global takeaway industry entering the era of "stock game" after the redlition, industry consolidation is becoming the trend. "Strategic Defense" against DoorDash's global expansion Analysts generally believe that Uber Technologies, Inc.'s aggressive move is primarily driven by the increasing pressure from its biggest competitor DoorDash. Currently, DoorDash holds a 67% share of the domestic takeaway market in the USA, far surpassing Uber Technologies, Inc.'s 25%. What is more concerning for Uber Technologies, Inc. is that DoorDash is expanding its footprint to over 40 international markets through acquisitions like Finland's Wolt and the UK's Deliveroo, establishing a strong foothold in Europe. In comparison, Uber Technologies, Inc.'s overseas delivery map has significant gaps, especially in mainland Europe where it lacks a large-scale local operating network. The value of Delivery Hero lies in its unparalleled global coverage. This Berlin-based takeaway platform operates in approximately 65 countries and regions across Asia, Europe, Latin America, the Middle East, and North Africa. Its growth in the Middle East and North Africa markets is particularly noteworthy, with a 16.1% year-on-year increase in gross merchandise volume (GMV) in the first quarter. Wolfgang Scheppe, an analyst at Berenberg Bank, pointed out that once Uber Technologies, Inc. completes the acquisition, it will directly obtain a "global takeaway network that far exceeds the DoorDash alliance," thereby forming a third pole in the global takeaway market with DoorDash and Meituan. The strategic significance of this position goes beyond financial investment. Filling the gap in Europe, acquiring instant-profit assets From a business synergy perspective, Delivery Hero's most immediate benefit to Uber Technologies, Inc. is filling its gap in the European market. Currently, DoorDash through Wolt holds a dominant position in multiple European countries, while Uber Technologies, Inc.'s delivery business in mainland Europe is comparatively weak. Acquiring Delivery Hero would instantly provide Uber Technologies, Inc. with mature operating systems, local merchant relations, and delivery networks in select markets in Europe, the Middle East, North Africa, and Asia, avoiding the high costs and time-consuming process of building from scratch. The financial synergies are also enticing. Referring to Uber Technologies, Inc.'s previous acquisition of Delivery Hero's Taiwan subsidiary foodpanda for 1.25 billion US dollars, the deal is expected to bring in a minimum of 150 million US dollars in adjusted core profits annually for Uber Technologies, Inc. The addition of Delivery Hero's overall business would significantly expand the scale effect of Uber Technologies, Inc.'s delivery business. Among Delivery Hero's asset portfolio, the Korean delivery platform Baemin is undoubtedly the core asset that attracts the attention of potential acquirers. Delivery Hero has initiated a strategic evaluation of its Korean business Baemin, including considering a full sale. Robin Zhu, an analyst at Bernstein Research, gave Delivery Hero a "buy" rating with a target price of 28 euros (excluding acquisition premiums). Zhu pointed out that Baemin is transforming from a subsidy-driven loss-making business to a "platform with discipline in monetization" - the Korean delivery market is stabilizing, and Quick Commerce offers additional growth potential, making government subsidy policies particularly favorable for Baemin. Analysts at UBS Group AG and Citigroup have given positive assessments of the potential sale value of Baemin. Citigroup analyst Monique Pollard believes that Uber Technologies, Inc.'s significant increase in holdings "further reinforces attention on the sale of Baemin." Antitrust - the unavoidable sword of Damocles At the equity distribution level, Uber Technologies, Inc. and Morgan Stanley have jointly woven a highly sophisticated equity network. As of May 18th, Uber Technologies, Inc. directly holds 19.5% of Delivery Hero's issued share capital and simultaneously holds 5.6% of call option equities, bringing the total equity stake to 25.1%, making it the largest shareholder of the company. According to sources familiar with the matter, Morgan Stanley is assisting Uber Technologies, Inc. in quickly increasing its stake through derivative instruments. At the same time, Morgan Stanley - which has reportedly been helping Uber Technologies, Inc. increase its stake rapidly through derivative instruments - disclosed in a regulatory filing submitted on May 22nd that the bank collectively holds about 30% of Delivery Hero's equity, mostly through indirect financial instruments like equity swaps. Under German securities law, once a shareholder's stake exceeds 30%, it will trigger a mandatory takeover offer obligation. Sources revealed that Uber Technologies, Inc. plans to increase its indirect stake above 30% through derivative instruments, indicating a clear intention to acquire, while still leaving room for formal acquisition - a strategy similar to Intesa Sanpaolo's acquisition of Commerzbank in Germany. Barclays PLC Sponsored ADR cautioned in a report that any transaction would "trigger serious antitrust issues, especially in the EU," adding another layer of uncertainty to the completion of the acquisition offer. A bigger regulatory gray area lies in: if DoorDash and Uber Technologies, Inc. jointly acquire Delivery Hero and split off the company's different regional businesses, this arrangement, while commercially feasible, may be viewed as a "market division" collusion in antitrust reviews. According to reports, the European Commission had previously expressed deep concerns about the competitive landscape in the European takeaway market during the review of Prosus' acquisition of the European version of "Ele.me," Just Eat Takeaway.com. A source close to the deal revealed that once Uber Technologies, Inc.'s stake reaches a specific threshold, it will need to go through an antitrust review first, saying, "Negotiations are still ongoing, and there is no definitive conclusion as to whether the acquisition deal can be reached."