Singapore’s Grab to go public in world’s biggest $40 billion SPAC merger

Grab Holdings, the largest ride-hailing and food delivery firm in Southeast Asia, has clinched a merger with special-purpose acquisition company Altimeter Growth Corp securing a valuation of nearly $40 billion and paving the way for a coveted U.S. listing.

The merger, the biggest blank-check company deal ever, underscores the frenzy on Wall Street as shell firms have raised $99 billion in the United States so far this year after a record $83 billion in 2020.

As part of Singapore-based Grab’s agreement with the SPAC backed by Altimeter Capital, investors such as Temasek Holdings, BlackRock, Fidelity International, Abu Dhabi’s Mubadala and Malaysia’s Permodalan Nasional Bhd will participate in a $4 billion private investment in public equity offering.

Funds managed by Altimeter Capital will lead the investment with $750 million. “Institutional investors looking for Asian consumer internet exposure are keen to diversify their allocation beyond a handful of companies,” said Varun Mittal, head of emerging markets fintech business at consultancy EY.

Grab said its decision to become a public company was driven by a strong financial performance last year.

The transactions validate Grab’s co-founder Anthony Tan’s strategy of aggressively tapping growth in new sectors and ramping up market share by pumping billions of dollars to localise its services and invest in high-growth economies.

Tan told Reuters the funds will be used to double down on the last-mile delivery network and to bulk up its financial services business, such as digital bank and mobile payments.

The 39-year-old launched Grab as a taxi app in Malaysia in June 2012 with fellow Harvard Business School alumni Tan Hooi Ling, and then quickly took it regional.

The deals for Grab, which was valued at just over $16 billion last year, are a big win for its early backers such as SoftBank Group Corp and China’s Didi Chuxing.