Grab to raise $1.25b through bond issuance for acquisitions

Grab Holdings Ltd. plans to raise US$1.25 billion through the sale of convertible bonds maturing on June 15, 2030.

The Singapore-based company announced on June 9, 2025, that the bonds will carry an annual coupon of up to 0.5%, payable semiannually.

Proceeds will be used for acquisitions and share buybacks.

As of March 2025, Grab had US$274 million remaining in its share-repurchase program.

The bonds can be redeemed under specific conditions starting in mid-2028.

This is the largest US dollar-denominated convertible bond deal by an Asian company since Ping An’s US$3.5 billion offering in July 2024.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Convertible bond trend reflects Asian companies’ strategic capital management

Grab’s $1.25 billion convertible bond issuance follows a significant regional trend, with Asian convertible bond offerings increasing 40% in 2024 compared to the previous year 1.

This financing method has gained popularity among Asian tech companies seeking capital flexibility in a high interest rate environment, as demonstrated by Alibaba’s $5 billion and Ping An’s $3.5 billion convertible bond offerings in 2024 1.

The attraction of convertible bonds lies in their hybrid nature, as they provide lower interest costs than traditional debt while delaying potential equity dilution, making them particularly valuable for growth-stage companies like Grab.

For investors, these instruments offer a compromise between the stability of bonds and potential upside participation if the issuing company’s stock performs well, which explains their current appeal in uncertain markets.

Morgan Stanley, HSBC, and JPMorgan’s involvement as global coordinators signals the institutional banking sector’s confidence in both the instrument and Grab’s long-term prospects.

2️⃣ Regulatory hurdles reshape Grab’s strategic expansion alternatives

Grab’s convertible bond issuance coincides with Indonesian antitrust authorities actively investigating the competitive implications of a potential Grab-GoTo merger, demonstrating how regulatory landscapes are actively shaping corporate strategy 2.