Grab in Talks to Go Public Via a SPAC

Mega-SPAC Incoming

Grab, a Southeast Asian ride-hailing startup, is in talks to go public via a merger with one of Altimeter Capital’s special purpose acquisition companies. The transaction, which could be announced later this week, may value Grab at around $35 billion. Grab’s board preliminarily signed off on the deal last month.

Deal-making in the SPAC sphere has been heating up recently as private companies find new ways to tap the capital markets. Singapore-based Grab would list in New York if a deal transpires.

Deal Details

Under the tentative deal, Grab will raise roughly $2.5 billion by selling shares in the public company via private agreements with investors. Nearly $1.2 billion will come from Altimeter, which agreed to backstop any share sales. Grab will merge with the Altimeter Growth 1 (AGC) fund. The fund raised $450 million in 2020 and is up 25%.

Altimeter Capital is a Silicon Valley investment firm which invests in tech companies preparing to go public. It oversees more than $15 billion in investments, including the $850 million it raised for its two SPACs. Cazoo, the UK online car company, and Snowflake (SNOW), the data analytics company are two of its other investments.

Grab Tests the Waters

Grab has a private valuation of around $16 billion. Since its inception in 2012, Grab raised has $12 billion in venture funding and has $5 billion in the bank.

While Grab has not yet turned a profit, its ride hailing business did break even in 2020, with revenue growing 70% year-over-year. The potential merger between Grab and a SPAC is garnering a lot of attention around the world and investors are eager to see how it unfolds.

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