German food delivery company Delivery Hero has agreed to acquire its South Korean rival Woowa Brothers for $4 billion, Woowa Brothers said in a statement on Friday.
Woowa Brothers said the companies will also create a joint venture in Singapore to tap into the booming food delivery market in Asia and compete with Grab, UberEats and Gojek.
The deal comes as Woowa Brothers Corp, which owns South Korea’s biggest food delivery service “Baedal Minjok”, faces growing competition from rivals such as e-commerce firm Coupang, backed by Japan’s SoftBank Group.
Delivery Hero ranks second in South Korea’s food delivery market.
Delivery Hero will acquire an 87% stake held by investors such as Goldman, GIC, Hillhouse Capital and Sequoia Capital, while the remaining 13% owned by Woowa’s management will be converted into the German company’s stake.