Delivery Hero has until November 5 to accept the deal, which is targeted to complete in mid-2027 subject to approvals.
Uber’s proposed $14.8 billion takeover of German food-ordering company Delivery Hero is being viewed as a test of the UAE’s strengthened competition laws, experts have told AGBI.
The deal could signal a tougher era for UAE merger and acquisitions (M&A), with regulators this summer given greater powers to scrutinise market dominance and potentially block transactions.
Under the regulations, parties involved in a deal must notify the UAE Ministry of Economy at least 90 days before a transaction completes if their combined annual sales in the local market exceed AED300 million ($81.6 million) or their combined market share exceeds 40 percent.
Parties with this degree of “economic concentration” would be barred from completing the deal if the ministry objects, the law states. The ministry has 10 days to review the notice and third parties have a further 15 days to object.
It is the first time the UAE has set thresholds for market dominance and represents a “far more rigorous and enforceable merger control regime that will reshape [local] dealmaking”, said Felicity Hammond, head of intellectual property at BSA Law.
“The days of treating the UAE as a jurisdiction with light-touch antitrust oversight are over.”
Antitrust laws seek to encourage competition by limiting the market power of any particular company. The UAE is seeking to align itself with international norms and implemented the new regulations to strengthen its 2012 Competition Law.
Uber’s proposed takeover of Frankfurt-listed Delivery Hero – recommended for approval by Delivery Hero’s board in September – would be likely to come under the new rules because of the size and scope of the resulting entity.
In the Gulf, Delivery Hero has an 80 percent stake in quick-commerce company Talabat and owns 100 percent of Saudi Arabian food-delivery company HungerStation.
Talabat has a 74 percent share of the Mena food delivery market, Marmore Mena Intelligence estimates, while HungerStation commands about 65 percent of the Saudi market. Talabat revenue has jumped this year. The GCC food delivery market is estimated to grow by nearly 7 percent annually by 2032 to $12 billion, MarkNtel Advisors estimates.
Under the acquisition, Uber would increase its total economic interest in Delivery Hero from 25 percent to about 53 percent, and expand its presence across the Gulf.
Delivery Hero has until November 5 to accept the deal, which is targeted to complete in mid-2027 subject to approvals.
“The implications for a transaction such as the Delivery Hero/Uber deal are immediately apparent,”
Hammond said.
“Where two platforms together command a significant share of the UAE’s food delivery and ride-hailing markets, notification and regulatory approval become unavoidable. This is not a mere formality.”
Andrew Steele, partner at Gibson Dunn, said the new regime is “broader and the triggers more sensitive… Filing volumes and market awareness of competition risk will rise.”
The regulator is also expected to be more active than in the past, Steele said:
“The ministry can now open an investigation without waiting for a complaint, inspect premises and review records.”
M&A activity in the UAE may take longer as a result, so parties must factor merger control into transaction timelines at an early stage, PwC partner Amir Kordvani said in a client note in June.
An Uber spokesperson said: “The UAE’s continued focus on strengthening competition and supporting innovation creates a strong environment for businesses to grow.
“We are proud that our investment in Talabat will contribute to the country’s digital economy and create value for consumers, merchants and workers.”
A spokesperson for Delivery Hero said the deal “has the potential to accelerate innovation and expand choice, value and convenience for customers.
“Delivery Hero will continue to engage constructively and transparently with competition authorities.”
Source: AGBI
