Grab to go public in the US through largest SPAC deal yet

Southeast Asian internet titan Grab has announced its plans to go public in the US through a deal with a special purpose acquisition company (SPAC) Altimeter Growth, the largest of its kind yet.

The combined company expects to trade on the Nasdaq under the symbol GRAB in the coming months.

Grab CEO Antony Tan / Photo credit: Grab

The SPAC deal, which values Grab at roughly US$39.6 billion, includes a US$4 billion private investment in public equity (PIPE) from investors such as Fidelity International and Janus Henderson. It will provide Grab with approximately US$4.5 billion in cash proceeds, according to a statement.

Prior to the announcement, Grab had raised about US$12 billion and amassed roughly US$5 billion in cash reserves, giving it a private valuation of around US$16 billion.

The company said the offering will “reinforce Grab’s strong business momentum,” including its gross merchandise value (GMV) of roughly US$12.5 billion last year, beating its pre-pandemic numbers.

This comes three months after the company said that its group revenues have returned to over 100% of its pre-Covid numbers. Ming Maa, Grab’s president, said that its total group net revenues jumped by about 70% in 2020 compared to the year prior, while it cut monthly EBITDA (earnings before interest, tax, depreciation, and amortization) expenditure by about 80%.

“It gives us immense pride to represent Southeast Asia in the global public markets,” said Anthony Tan, group CEO and co-founder of Grab. “As we become a publicly traded company, we’ll work even harder to create economic empowerment for our communities, because when Southeast Asia succeeds, Grab succeeds.”

Industry experts anticipate that Grab’s trade debut will kick off a spree of regional IPOs and listings, including those of Indonesian travel major Traveloka, Grab archrival Gojek, ecommerce giant Tokopedia, and Singapore-based proptech firm PropertyGuru.

See Also: The leading Asian tech players eyeing an IPO in 2021

The SPAC deal comes after the fallout of Grab’s reported merger with Gojek. The two super-app contenders have been working on an agreement since the start of 2020, but talks appeared to have died down early this year.