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Delivery Hero welcomes Baemin, seeks new home for Yogiyo

By Dec 28, 2020 (Gmt+09:00)

Baedal Minjok rider 
Baedal Minjok rider 

Germany-based online food delivery service Delivery Hero SE will sell off its prized South Korean business, Yogiyo, the country's second-largest food delivery app, to acquire No. 1 market player Baedal Minjok, the company said on Dec. 28.

On Monday, the Korea Fair Trade Commission (KFTC) finalized its decision to issue conditional approval for Delivery Hero's proposed acquisition of Baedal Minjok (Baemin), in which the regulator maintained its stipulation from a month earlier, calling for the German online food delivery service to offload a 100% stake in Delivery Hero Korea, the operator of Yogiyo, by next June.

Last month, the Korea Fair Trade Commission (KFTC) issued conditional approval for Delivery Hero's plans to acquire almost an 88% stake in Woowa Brothers Corp., the operator of Baemin, for $4 billion. 

Initially, Delivery Hero was adamant that it would not sell Yogiyo, which has been in operation since 2012, saying it would deliver a compelling argument at the standing committee hearing to persuade the regulator to change its decision.

But over a month later, it appears that Delivery Hero has scrapped its plans to house Korea's two leading food delivery apps. Instead, the company has accepted KFTC’s decision and will divest of its existing Korean operations.

Following the transaction, Delivery Hero and Woowa will move forward to set up a joint venture in Singapore that will oversee Asia-based operations, according to a Delivery Hero press release.

"Delivery Hero saw that they couldn’t change the Korean regulator’s decision and determined that it would be best to acquire the country’s leading delivery app,” said an industry source.

If Delivery Hero sells Yogiyo and acquires Baemin, its market share will virtually double from 32% to 63% in Korea's food delivery market.

Graphics by Jerry Lee
Graphics by Jerry Lee

Korea’s delivery market has been growing at a rapid pace. According to Statistics Korea and the KFTC, the delivery app market soared by 84.6% in 2019 compared to the previous year. This year it is expected to post a similar growth rate and top 15 trillion won ($13.7 billion) owing to the COVID-19 crisis, which has boosted the use of food delivery services.

Industry watchers say food delivery apps will see continued growth even in the post-coronavirus era as consumers have become comfortable and familiar with their services.

Graphics by Jerry Lee
Graphics by Jerry Lee


Delivery Hero is under a tight six-month deadline to find a new home for Yogiyo. If a suitable buyer is not chosen, the deadline can be extended until the end of 2021.

Food industry players expect Yogiyo’s price tag to be around 2 trillion won ($1.8 billion), roughly half of Baemin’s value. Much attention will be placed on who becomes Yogiyo's new owner. 

"The estimated price for Yogiyo is too burdensome for private equity firms, making it likely for large business groups to step in," said a food industry official.

Potential buyers include platform companies that have forayed into the delivery app market, alongside large companies with big retail operations. 

Major platform giants, including Kakao Corp., Coupang Corp. and Wemakeprice, are likely to go after Yogiyo, given that delivery apps serve as a bridge between consumers and restaurants.

Kakao, the country's largest messaging app operator, has already tapped into the delivery market by offering an ordering feature on its messaging app, Kakao Talk. 

Coupang is a dark horse in the delivery platform market thanks to its food delivery service, Coupang Eats, which holds a 3.1% market share. If Coupang or Wemakeprice, the fourth market player, acquires Yogiyo, they could become the second-largest market player.

Delivery Hero welcomes Baemin, seeks new home for Yogiyo

Food business groups and retail giants are also expected to be strong contenders for Yogiyo, including the Lotte, CJ and Shinsegae groups alongside Hyundai Department Store Co., GS Retail Co. and E-Land Ltd. 

"Yogiyo has over 200 talented developers who would be desired by any company," said an industry official. "IT companies and retail heavyweights have shown interest in acquiring a stake in the delivery service," the official added.

Meanwhile, others say that Yogiyo may not be an attractive asset, as it remains in deficit despite investing large sums of money on marketing.

Write to Jong-pil Park and Ki-man Kim at

Danbee Lee edited this article.

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