[팩플]Approval of’Baemin M&A’, K-unicorn backlash… Who lives Yogiyo

An immediate answer came out to Kangsu saying, “To buy Baemin, it is Yogi and Palla”, and “Yogi and Panda”. The’K-unicorns’ protested “blocking our way”, and the industry was in a hurry to calculate ‘2 trillion yogis, who will live.

This is what happened after the Fair Trade Commission announced on the 28th that’Delivery Hero (DH)-Delivery’s People’s Union’ was approved as a condition of sale.

It was concluded one year after DH’s request for approval of a business combination was made. The FTC’s answer was’If DH wants to merge with Baemin, sell it. Not to allow the combination of the first and second delivery apps. The startups I’ve been watching are depressed.

· DH immediately announced that it has accepted the conditions of the Fair Trade Commission for the acquisition of Baemin. It is planning to sell all shares of Delivery Hero Korea (DHK), a Yogiyo delivery box operator.
· The Korea Startup Forum, which includes 1,500 domestic startups, announced on the 28th that “regardless of whether DH is accepted or not, the decision of the Fair Trade Commission will have a negative impact on the digital economy and the startup ecosystem as a whole.”

The DH-Baemin combination is the first case in which the FTC established a separate task force (TF) to screen the online platform. In the view of the venture industry, the government decided it was conservative. The industry sees it as a’signal of stronger online platform regulation’.

· Various transactions such as shopping, finance, real estate, and taxi calls are carried out on the online platform. Unicorns and spare unicorns such as Jikbang, Yanolja, Toss, and Curly appeared one after another. ※Unicorn is a non-listed startup with an enterprise value of KRW 1 trillion or more.
· They are sensitive to’market definition’. This is because unicorns can be classified as a’monopoly company (market dominant position)’ according to the FTC’s market division. Then, there are restrictions on business expansion or mergers and acquisitions (M&A). The better the FTC divides the market, the more so.
In this review, the FTC saw that food delivery’s’phone order’,’franchise app’,’internet search’, and’delivery app’ were different markets. No matter how much sales are generated from’Naver Search’ or’McDonald’s App’ or’Baemin-Yogiyo-Coupangitsu’, it is said that the monopoly is considered by the share in them.
· The Fair Trade Commission acknowledged the rapid growth of Coupang Itz, but judged that it’is not a competitor’. “(Coupangitsu) has less than 5% market share in the national market, so there is not enough competitive pressure for Baemin-DH.” We compared the transaction amount of Coupang Itz, which operates only in some areas such as Seoul, with the transaction amount of Baemin and Yogiyo, which are national services.
· Cospo criticized “Coupang’s recent entry into video service (OTT) and that it is difficult to distinguish the fields of the platform easily. The FTC denied the dynamics of the digital economy.”

The start-up industry protests that’Unicon’s M&A and exit are more difficult due to the decision of the FTC.

· Baemin is the 6th unicorn in Korea and the first exit unicorn. Exit means that investors successfully recover money spent on startups through IPO or merger and acquisition (M&A).
Unicorn and reserve unicorn companies such as Coupang, Toss, Jikbang, Yanolja, and Wemake have grown by changing the market, but have yet to exit. This is why the industry is sensitive to the Baemin M&A review, which is more difficult than expected.
· Professor Yoo Sang-Sang of Soongsil University said, “Only if Unicorn’s exit is active, foreign investors actively invest in domestic startups.” “The government is raising startups and the negative thing about M&A is double.”

Who is the company that can afford Yogiyo’s ransom, which is around 2 trillion won? The deadline for sale by the Fair Trade Commission is next June. The venture capital (VC) industry is referring to several candidates.

· Platform with DNA Naver· Kakao’s name appears. However, Naver CEO Han Seong-sook said at a press conference last month that he does not directly enter the delivery market. Naver is running as an investor in the delivery agency market. As I thought, the 1st and 3rd largest shareholder in the industry.
· cacaoAlready has contact with local restaurants through’Order’ and’Kakao Talk Channel’. However, businesses connected with small and medium-sized merchants have unique external risks such as controversy over fees. It is evaluated that the advantage of Kakao’s direct entry into the market by acquiring Yogiyo is not significant.
· If the synergy effect is greater when taking over Coupangto be. The important thing in the platform industry is to be No. 1, and when Yogiyo is acquired, Coupang Itz quickly becomes second in the industry. Coupang’s cumulative deficit, which is close to 5 trillion won, is a stumbling block, but it is another variable that SoftBank, Coupang’s largest shareholder, recently saw a large return on investment in the delivery app door dash.
· Recently devoted to food delivery Uber, The Chinese version of the people of delivery with 500 million users Maytuum, Southeast Asia Super App grab The same global powers are also discussed. Foreign private equity funds with abundant funds are also candidates.
Large distribution companies such as E-Mart and Lotte are also candidates. The delivery network already exists, but the value of the near-distance delivery channel that will handle the last mile is increasing.

As the delivery market has grown rapidly since Corona 19, M&As are active overseas as well. The industry rankings are also changing rapidly.

Until 2018, Grub Hub occupied the majority of the US food delivery market. Doordash, followed by Uberitz.
The market fluctuated in 2019. Door Dash, which was second place, recaptured the first place in the US market last year (51% share). This is the result of increasing direct delivery after acquiring rival’Caviar’ in the same year. SoftbankFunded 750 billion won. Doordash was listed on the New York Stock Exchange on the 9th. The value of SoftBank’s stake increased by 17 times as of the day.
· Uberits, the third largest company, also jumped in before the M&A. When he failed to acquire Grub Hub, he immediately acquired Postmates, the fourth-largest company, and rose to the second place in market share.

Reporters Shim Seo-hyun and Park Min-je [email protected]

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