Delivery Hero has encountered some obstacles in its efforts to sell South Korean food delivery platform Yogiyo, including possible information leaks on the takeover target.

South Korea’s antitrust regulator has said Germany-based Delivery Hero needs to sell its wholly-owned unit Delivery Hero Korea, the operator of Yogiyo, to win approval for a $4 billion takeover of the country’s top food delivery app operator Woowa Brothers, which owns leading food delivery app Baedal Minjok.

Market participants are showing strong interest in Yogiyo, the second largest food delivery platform, but cited potential information leaks on the target as a disincentive.

Delivery Hero has a good understanding of the weaknesses and strengths of Yogiyo, and will remain in the same industry with Baedal Minjok, a factor that could significantly weaken the appeal of Yogiyo for investors, market insiders said.

“Delivery Hero, which will acquire Baedal Minjok, is well-informed of data accumulated by Yogiyo,” said an industry source. “It will be an unfavorable condition for an acquirer of Yogiyo to compete with its rival in a situation where all of its sensitive data is revealed.

“Enterprise value of delivery platforms is calculated based on accumulated client data, order algorithm, the number of riders and delivery orders,” said the source, adding that core elements of Yogiyo’s enterprise value are known by its new rival.

“There are some cases where rivals are excluded in a deal due to worries over information leakage in the same industry,” said another industry source.

The flow of funds after the acquisition is considered another possible obstacle. Delivery Hero has to sell a 100% stake in Yogiyo, which is estimated to be worth about 2 trillion won, and the buyer will be handing a huge amount of money to Delivery Hero that could help its much larger rival devise a plan to widen the gap with Yogiyo.

“Delivery platform businesses require a lot of money to secure users and riders,” said another source. “It doesn’t seem reasonable to give the largest player funds worth a trillion won to take over the second largest player.” (Reporting by Byung-yoon Kim)