Delivery Hero said on Friday that talks for the potential sale of the company’s Foodpanda business in selected markets in Southeast Asia were ongoing.

“There are market rumours that the negotiations for the potential sale have collapsed. We confirm that the negotiations for the potential sale are ongoing, and, thus, the rumours are false,” the company said in a statement.

The New Straits Times reported on Friday that talks with Grab on a Foodpanda sale had collapsed.

Shares, which had dropped more than 13 per cent in morning trade after the report, pared losses and were down 6.6 per cent to 20.08 euros at 11:46 GMT.

Delivery Hero has been trying to divest its loss-making Southeast Asian business in a wider effort to reach profitability while maintaining growth, as investor concerns regarding the company’s cash position grow.

Selected Southeast Asian markets include Singapore, Malaysia, the Philippines, Thailand, Cambodia, Myanmar and Laos, it said.

If an agreement is reached and signed, the transaction is expected to be subject to certain conditions, including obtaining necessary regulatory approvals in relevant jurisdictions, the company added.

(Writing by Linda Pasquini, Editing by Rachel More)