May I now hand you over to Daniel Fahd Yastani. Please go ahead, sir.
Thank you, and good afternoon, good evening or good morning, depending on where you are here from Berlin. Thank you for joining on a arguably short notice for this call. You've all seen the news that went out a bit earlier, and I will keep this introduction very short before I hand over to Niklas. Just being mindful of the time here, we had to squeeze this call in, obviously. So we are a little bit pressed for time later on for the Q and A.
We'll maybe only have 10, 15 minutes. So therefore, apologies in advance. We are available also after the call, needless to say. And so the people who ask a question, can we please ask you to limit it to 1? And we also ask for your understanding that we will try not to have follow ups so that we get a couple of questions at least.
With that, I would like to hand over to Niklas, and Emmanuel, of course, is also on the call to answer questions later on. But with that, Niklas, to you.
Thank you, Daniel, and good afternoon, everyone. So given the recent news in Korea, we wanted to give you the chance to hear some context around this and outline the current situation. We can confirm having received the so called examiner's report from the Korea Fair Trade Commission or KFTC earlier this week, we respect to in respect to the joint venture and strategic partnership with BUBA. In the examiner's report, the KFC case team proposes approval of the transaction. The proposal is on structural remedies as a condition for approval of the transaction.
As such, they a Jogyo. Delivery Hero does not support this proposal. Divesting the company's ownership in 1 of its or one of our Korean assets will not benefit the local ecosystem, and it might weaken Liberator's position to elevate the customer with a final decision and approval of the KFTC Commission. There is yet no certainty whether KFTC will follow the examiner's suggestion to divest recommendations presented by the CASE team. The KFTC commissioners will make their final decision following 1 or 2 hearings in which both delivery and content of the KFTC decision is currently not determined depending on whether 1 or 2 hearings will take place.
It is possible that the final decision from KFTC will not be taken before KFTC as is a recommendation and not a final decision by a 10% prior to GOOVA, significantly less if we include GOOVA in this. But as I said, it's less than 10% prior to VOOVA. The percentage is declining. It's a slow growing business, but it's highly profitable and will therefore cost us some positive EBITDA contribution. But again, this assumes, assumes 1, we cannot influence the CapEx Commission to change the remedy suggestion from the examiner's report, which we are confident we can and 2, that we would accept the proposed remedy.
I would also like to point out that at no point did the company nor the management board expect the outcome of the current recommendation of the examiner. Of the examiner. We were extremely surprised by this report and the recommendations specified within it. We don't think it's in the best interest of the Korean ecosystem in particular. We always give a realistic view on our expectations concerning the ongoing process.
Having said that, this is a conditional approval. And while we are not pleased with the suggestion, we see it as a starting point for negotiation. On the negative side, again, we now expect the process to take 1 to 3 months longer. I would also like to comment on share trade that I did on on November 6, disposing less than 10% of the direct shareholdings I owned at the time and a prior Thursday as a result of the presidential election in U. S.
Please note that the share trade took place well before receipt of the examiner's report, which I was not aware of at any time of the sale. I hope you all know that I would never have conducted this disposal if we or I had expected the viewpoint of the examiner's report. The timing of SRSL by SCO is never good, but this was, of course, very unfortunate, and it puts me in a very uncomfortable and embarrassing position. I'd like to make clear, I'm still a huge believer in the company, and I maintain more than 95% of my shares and options in the company. Looking ahead, the Liberty here will continue the discussions with KPC and is convinced the outcome of the hearings will lead to the company's satisfaction.
Again, I'm a huge believer in the company and our growth. So with that, I will now open for a few questions. A
answer And the first question we received is from Giles Thorne of Jefferies. Your line is now open, sir. Please go ahead.
Thank you. I had ten questions, but I'll ask one.
Thank you.
I would love to ask
for Tempur. Nicholas, hypothetically, if you had been offered a year ago or 18 months ago, the opportunity to secure WUWA with 0 anti trust risk on reasonable terms, would you or would you not have wanted to do that? And I'm working on the premise that in network effects businesses, you always want to be the big guy, and this would have given you a path to being the big guy. So I appreciate what's on the table here is not what you planned or wanted or moved towards, but it feels to me the outcome is still incredibly good.
I'll try to answer as you asked me specifically and then Manuel can also answer. First, I'd like to make clear that we are still in negotiation with the KFC or we are starting the negotiation. Until now, it has been examiners have done their report and now starts the negotiation. And they have made their position clear. And we will now make our position clear.
And we think that we have very good arguments, very good grounds and negotiation just started. I would therefore not like to make clear exactly where my position is. I think in general, a process that takes 1 year is very bad for a company. If that is in Korea or U. K.
Or any other place, I think it's very long time. And I think it's not great. So in that sense, an early or fast process approval would, of course, have been worth a lot. Now that has not happened. So now I also want this to be at a good outcome.
And I will unfortunately have to pass a little bit to what we think is an acceptable, what we think is a good outcome. We have said what we think is a good outcome. And I've shared my view roughly that this is impacting us with less than 10%, if we would agree to this and less than and obviously much less than 10% after Avuba deal. But it might be a slow growing asset, your view, but it's a very profitable one. And therefore, it's, of course, very unfortunate if we would have to sell this asset assuming that we would agree to this remedy.
Understood.
But I think the good part is that at least it's now more in our control now prior to knowing the view of the commissioner or to the examiner's report, sorry, examiner's report, there was way more uncertainty, at least for me and Delivery Hero, even if we were very confident to get an approval, any doubt of that approval, I think, is now unaground in my view. So you're feeling that that's possible? If you agree to this remedy and how we can negotiate, and the starting point is now clear.
So the implication of that final sentence, Niklas, is that and again, I think you're not going to answer me, but would you accept this
remedy? I cannot answer that. That would also weaken my negotiation position. Now negotiation starts. We know at least from I know what the negotiation starts.
We know at least from I know what the worst outcome could be. And I know what I want the preferred outcome, where I think the right outcome for the Korean community should be. And we will try to negotiate it to get to what we think is the best resolution. But I cannot answer if we would accept this or not.
Of course.
Thank you very much.
Thank you very much.
The next question we received is from Joseph Barnet Lamb of Credit Suisse. Your line is now open. Please go ahead.
Excellent. Thank you. Thank you, Nicolas, for taking my question. I also will only go with one then. With regard to examiners' proposals, does their proposal stipulate or place any restrictions on who you can sell YOGIYO to?
And in addition, does it propose any behavioral remedies such as commission caps? Thank you.
I may jump in here. Okay. Yes, please. So in terms of restrictions, no, I forgot like restrictions in terms of behavior remedies, right?
So And who to answer?
Yes. No, I mean, I think it's too early for us comment. I mean, so far, we're not aware of any restrictions, and I don't think there are. But this is too early to say. We will have the first hearing and have the detail around the conditions if a divestiture should take place.
Again, I think it's very important for us make clear, this is a recommendation and this is not a decision. That's very important. So we will challenge this recommendation from zigzagamer in front of the commission. But so far, we're not aware of any restrictions to whom to sell to. But again, we will make sure that this recommendation that we are challenging this recommendation.
And besides what we mentioned today in terms of the recommendation to de invest, we're not aware of further any kind of restrictions or remedies at all in terms of behavior at this point of time. But having said that, we are preparing the first hearing, and the outcome of this hearing is not done yet, obviously. So it's that's the status quo today that we can share with you.
And the next question is from Monique Pollard of Citi.
Hi, afternoon, everyone. I'll stick with one question, 2, please. Following on about the sale of Yozio, what I'm interested in is, is there any stipulation in the document of the examiner's report as to what happens if you can't find a buyer for Yogyal? So say you accept this remedy and you try and sell Yogyal and there's not a buyer, what happens then?
So we cannot comment on all the details in the examiner's report. But I know there has been cases before in Korea where there has been or one case at least where there had been a restructured remedy of sale of an asset. The company who wanted to sell could not get an agreeable price. And they went back to the KPC and got approval for not selling the asset as far as I'm aware. So I think that's the case that I have in mind that there has been a case where KFTC then afterwards reversed the decision based on a non acceptable outcome.
Now, of course, every case is individual, and I cannot comment on our specific case. I can only refer back to what has been done in the past in this occasion.
Okay. Understood. Are you able to give who that case related to?
I forgot now the name. If someone can help me out here then please I don't have to say enough because I'm not sure which company it was or the name of it.
Can you repeat, sorry?
We will have to come back on that. I cannot remember the comment. I'll see if I can find it by the end of the call.
And the next question we we received is from Andrew Ross of Barclays. Your line is now open. Please go ahead.
Great. Thank you and good afternoon everyone.
I wanted to ask
about the conditions of the break on the WUWA side. And I guess I'm thinking that if the KFTC were to follow the examined recommendation and your thoughts
to sell YO,
can the WUWA guys walk away? And are there any clauses in place that would prevent a hostile bid for WUWA, given that at that point the 2 to 1 would be off the table and it would really be
a question of the highest bidder? No. We don't see this as a potential outcome. If I understood the question correct, if we, for some reason, would not agree to such a remedy and if then someone could come and competing business no. But I know we have a share purchase agreement in place, and we awaiting the approval from the commissioner or KTC Commission.
And until that has been approved and we have agreed to it, there is no possible implication there.
But I think in general, I mean, it's fair to say that basically, if there we get the kind of conditional approval, but if we're happy to say I mean, if we agree to this remedy that is mentioned by the examiners today, which we will challenge, we will be able to close the transaction or to start to close the transaction. So basically, now this is our challenging this remedy because we think this is not a good one for the ecosystem and we want to challenge it. But this is also a sign that basically this transaction can be improved by from the point of view of the revenues by the KFCC, by the commission.
Just to follow-up on
that, obviously not a lawyer, but does that share purchase agreement definitely prevent the RUVICA from walking? Or is there some kind of break fee under which they could? Because I guess one of the reasons to go with Liberty Hero was merger synergies. And if that can't happen, maybe their take might be different.
The way we see it, no. So we are in full alignment also with VUVA that we are going to get this through. The delivery here has a I don't want to go into the specific of the SBA, but no, the way we see it, no. I think also it's fair
to say that with Bouva, we share a view that this is far more than Korea. So I think with Buba, we have this goal that we want to continue to build this great company together. It's not limited to Korea. So I think that's also very important to keep in
mind. Got it. Thanks, guys.
All right. I know some people will hate me for saying this, but because we see we have more people in the line. But as I said earlier, we had to squeeze this in on short notice in between. I'm sorry, we have to cut it off here. We have the names who still wanted to ask a question, and Chris and I will get back to you in due course.
So therefore, thank you all for dialing in.
I have one more question. I have time for one more. If we one more, that's fine.
And operator, we can take the next in line.
The next question we received is from Andrew Gwyn of Exane. Your line is now open. Please go ahead.
Hi there. Good afternoon. Yes, very quickly, could you just align or tell us why
the examiner, their approach is that this is bad and you think it's good? Just help us understand really where this sort of misalignment in opinion is. Thank you.
I think like the recommendation that we've seen from the examiners, there is no there is not the rationale I mean, the rationale thinking behind it is not explained to us so far in the from what we understand. So we will have to dig into the report that send us even more and in order to prepare the hearing. But the rationale, we can't follow so far. As we said, we think this is not a benefit for the ecosystem, but we don't recognize the kind of rationale and the reason why so far. So we'll have to it would be part of the preparation of the hearing, obviously.
And I think the reason why Okay. Thanks, guys. Good luck.
Is a huge value for the society or for the community is we can partner up. We will have more resources to invest. We can add logistics to a better extent more effectively at better terms. We think that we can combine, have a much better user experience. We can drive on innovation.
There is a lot in agreement that also goes into investments, both from a fund's point of view into start ups and much more. So we think that there are an enormous amount of value. And I think it would significantly strengthen from an ordering restaurant and I think rider and by the communities. So we obviously have a different view here. We don't see this as a good solution for the society, and that's also what we really want to drive.
We want to drive a good solution for everyone involved, and we think that our that this is not to achieve that. But as Emmanuel said, unaware we do not yet we cannot answer for them at this point in time. And thank you very much, everyone, for listening in. And I'll I appreciate all your support. As I said, we do not like the outcome of the report, but this is a starting point in the negotiation.
I think on the positive, at least for delivery here's point of view, is that now we know what the range of outcome is. And it is a more thin range of outcome than before because we believe that at least we are in a position where we can decide or not. So we in this sense, more in control. Even if we don't necessarily like the remedy that I've suggested, then we will negotiate and try to find a better solution. But it gives a lot of certainty for us in our negotiation with the KFC that starts now.
Thank you, everyone.