Yanolja reviews acquiring DH's food delivery service

Scooters of Yogiyo are parked in front of Delivery Hero's local branch in Seoul in this 2020 file photo. Yonhap

By Kim Jae-heun

The country's top travel and lodging service platform operator Yanolja is reviewing whether to bid for Delivery Hero's food delivery company Yogiyo. DH's leading underwriter for the sale of Yogiyo is Morgan Stanley and it has sent an investment memorandum to potential buyers including Lotte, Shinsegae and GS Group as well as Yanolja.

The company has to consider if it can create synergy between the country's No. 2 food delivery service and its travel platform.

Yanolja currently has over 15 million members, and management believes acquiring Yogiyo can help it to become a comprehensive platform in the fields of travel, dining and accommodation.

Bookings for hotels and restaurants account for 60 percent of the global travel market currently; and as quality of travel has become important, demand to dine at fine restaurants and stay at deluxe hotels has soared.

The variety of platforms for recommending good restaurants and making bookings is large.

Yanolja is set to acquire NOWBUSKING Company in November. NOWBUSKING Company is an operator of NOWWAITING, a mobile application that offers automated waitlist management services for businesses. NOWWAITING had 20 million accumulated users as of the end of last year, and over 2,600 restaurants and stores use the system.

Yanolja will seek to create synergy between NOWWAITING and Yogiyo, as the two players have common ground as services businesses in the food sector. If Yanolja acquires Yogiyo and combines it with NOWWAITING, users will be able to book a table at a restaurant, order food or put their name on a mobile waiting list on an all-in-one platform.

The company's ultimate goal is to become Korea's Meituan, a Chinese platform that provides retail services including entertainment, dining, delivery and travel. It is one of the world's largest online and on-demand delivery platforms with over 700 million members and 33 million enterprises doing business on it.

“If Yanolja successfully takes over Yogiyo, it will be able to establish the infrastructure to become the next Meituan. This is why it has recently scouted M&A deal expert Choi Chan-suk as its chief investment officer and has been seeking various strategies to make changes to the platform,” an industry source said.