After four years of operation in Vietnam, Baemin, South Korea’s leading food delivery platform, is set to withdraw from the market on December 8 due to intense competition, according to media reports on Saturday.
Germany-based Delivery Hero SE has opted to exit the Vietnamese market, citing challenges stemming from global macroeconomic conditions and long-term profit trends. According to media reports, the parent company of Baemin Vietnam will shift its focus to other markets where it maintains a leading position.
During August, Delivery Hero’s co-founder and Chief Executive, Niklas Östberg, informed Reuters that the company’s overall business in the Asian market was thriving, except for Vietnam. Consequently, the German company initiated the process of downsizing its operations in Vietnam during the third quarter of this year.
In 2019, Baemin made its entry into the Vietnamese market through the acquisition of the local player Vietnammm from the Dutch company Takeaway.com. According to tech industry research firm Momentum Works, Baemin Vietnam held a 12% market share in the country’s food delivery sector last year. This figure trailed behind Grabfood, which had a 45% market share, and Shopeefood, which held a 41% share in the same period.
In October, Baemin secured the leading position in Korea’s food delivery market, capturing approximately 65% of the market share, as reported by Seoul-based data research firm IGAWorks. Following Baemin, the second-largest player was Yogiyo with a 19% share, while Coupang Eats held the third position with a 15% share.
In 2019, Delivery Hero inked an agreement to purchase an 88% stake in Woowa Brothers Corp., the operator of Baemin, for $4 billion. The ultimate transaction value, disclosed by the German food delivery giant in March 2021, amounted to €5.7 billion ($6.2 billion).
In 2021, Delivery Hero divested its entire stake in Yogiyo to a consortium comprising GS Retail Co., Affinity Equity Partners, and the UK-based investment firm Permira for 800 billion won ($612.4 million). This divestiture was a prerequisite for the acquisition of Baemin, mandated by the Korea Fair Trade Commission due to concerns about Delivery Hero’s potential monopoly in Korea.
