Grab is in talks to go public through a SPAC merger

Grab Holdings Inc. is in talks to go public through a merger with a SPAC that could value the Southeast Asian ride-sharing startup at up to $ 40 billion, making it by far the largest deal of this kind. registered type.

The Singaporean company is discussing a deal with a special-purpose acquisition company affiliated with Altimeter Capital Management LP that would value it between $ 35 billion and $ 40 billion, according to people familiar with the matter. (The altimeter has two SPACS – could not tell which one is in conversation with Grab.)

As part of the deal, Grab would raise between $ 3 billion and $ 4 billion in a so-called PIPE, a funding round that typically accompanies a SPAC merger, the people said. That amount could still change as Grab and Altimeter will start meeting with mutual funds and other potential investors soon, some of the people said.

The parties could announce the deal in the coming weeks, although talks could still fall apart and Grab could revert to an earlier plan to host a traditional initial public offering on a US exchange this year.

If they go ahead with a SPAC deal, it would be the highest watermark in a recent explosion of such transactions, in which an empty shell raises money in an initial public offering with plans to later find one or more companies to merge. In some cases, the SPAC ends up with only a small portion of the new public goal.

So far this year, a record over $ 70 billion has been raised for SPACs, which account for more than 70% of all public stock sales, according to Dealogic. Several companies are in talks for a SPAC merger or have already agreed to one, including shared office firm WeWork, online photo book maker Shutterfly Inc., and online lender Social Finance Inc.

In addition to transportation services, Grab, founded in 2011, delivers groceries and other items and provides digital financial services to merchants.

Its sponsors include SoftBank Group Corp.

, Uber Technologies Inc.

and Toyota Motor Corp.

It was last publicly valued at around $ 15 billion in a fundraising round in October 2019, according to PitchBook.

Altimeter SPAC: Altimeter Growth Corp.

and Altimeter Growth Corp. – raised $ 450 million and $ 400 million in the October and January IPOs, respectively. Altimeter Capital, of Menlo Park, California, manages about $ 16 billion and invests primarily in technology companies.

The firm has amassed a string of successful investments and was a major participant in a Roblox funding round in January. Corp.

it raised before its IPO at $ 45 a share. On its debut on Wednesday, the video game platform’s shares traded more than 50% above that level and continued to rise Thursday morning.

SoftBank of Japan, which invested through its Vision Fund, is also poised to win big at Grab.

Private companies are flooding into Special Purpose Acquisition Companies, or SPACs, to avoid the traditional IPO process and obtain a public listing. WSJ explains why some critics say that investing in these so-called blank check companies is not worth the risk. Illustration: Zoë Soriano / WSJ

Write to Maureen Farrell at [email protected]

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