Meituan not buying Foodpanda after all
Grab investors can breathe a sigh of relief. Business Times reports that Meituan's backing out of the foodpanda acquisition talks, and honestly, this makes sense for everyone involved.
When rumors first surfaced that Meituan might buy foodpanda, Grab's stock tanked 10% in two weeks. The market was pricing in a serious new competitor entering Southeast Asia. DBS Group Research is now calling for a "relief rally," and I'd bet they're right.
Here's the thing - foodpanda's delivery business in Southeast Asia is tiny compared to China's market. DBS points out it's only about 5-6% of China's delivery market size. Plus, foodpanda doesn't even operate in key markets like Indonesia and Vietnam. What exactly would Meituan be buying? Limited upside, lots of execution risk.
This is actually good news for competition in Southeast Asia. Grab gets to keep building without a Chinese giant breathing down their neck, and the market stays competitive enough to keep everyone honest. Sometimes the best acquisitions are the ones that don't happen.