"The FTC Secretariat's Review Report Is Part of the Process... Will Discuss at the Full Commission Meeting"
Consensus Between FTC and DH on 'Swift Agreement'
[Sejong=Asia Economy Reporter Joo Sang-don] Delivery Hero (DH), which is pursuing a merger and acquisition (M&A) with Woowa Brothers (Baedal Minjok), has stated that it cannot accept the Korea Fair Trade Commission's (FTC) condition of "selling Yogiyo to acquire Woowa Brothers."
On the 23rd, DH responded in writing to Asia Economy's question, "Will you accept the FTC's condition to sell Yogiyo in order to acquire Woowa Brothers?" by saying, "DH does not support this proposal." Earlier, on the 13th (local time), DH had expressed on its German headquarters' website that "it is uncertain whether we will accept the FTC's proposal to sell Yogiyo." This recent response can be seen as a polite way of stating that "currently, there is no intention to sell Yogiyo."
DH announced its plan to purchase shares and establish a joint venture with Woowa Brothers in December last year. Subsequently, it applied for a corporate merger review with the FTC. In response, the FTC Secretariat sent DH a review report containing a conditional approval stance (including the recommendation to sell Yogiyo) around the 13th, about 11 months later.
DH emphasized that the review report is "part of the process" for the FTC's final approval decision on the corporate merger and stated its plan to focus on the full commission meeting. DH explained, "The issuance of the review report is part of the overall process and an intermediate step before the full commission meeting and the final decision and approval by the FTC. The final decision will be made after the full commission meeting where each party (DH and the FTC Secretariat) presents their positions. The timing and content of the full commission meeting have not yet been finalized." This indicates that DH intends to contest the Secretariat's conditions at the full commission meeting.
While expressing confidence in the final outcome, DH left room for the possibility of proposing alternative measures to the FTC. A DH official said, "We will continue consultations with the FTC, and we are confident that the final result will satisfy the company. It is not yet certain whether we will follow the Secretariat's proposal to sell Yogiyo or request other solutions (improvements)." The official refrained from disclosing specific details of any counterproposal.
According to the FTC's case handling rules, DH must submit its opinion on the review report within four weeks. Although this deadline can be extended, it is unlikely that DH, which is pressed for time, will delay it. From DH's perspective, any delay in this M&A could disrupt its strategy to enter Asia through Baemin, and the FTC has also announced a policy to reach a conclusion within the year. Thus, both DH and the FTC share a consensus to "reach a conclusion as soon as possible." The FTC usually delivers the Secretariat's review report to the commissioners about a week before the full commission meeting and appoints a lead commissioner. In this case, to expedite the decision, the review report has already been distributed to the commissioners.
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