Grab Holdings is set to announce a merger with U.S.-based Altimeter that will value Grab at nearly $40 billion and lead to a public listing.
The merger will make Southeast Asia’s largest ride-hailing and food delivery firm the biggest blank-check company deal ever.
Grab’s agreement with a special purpose acquisition company (SPAC) backed by Altimeter Capital includes a $4 billion private investment in public equity (PIPE) from a group of Asian and global investors including Fidelity International and Janus Henderson.
The deal for Singapore-based Grab, which sources have previously said was valued at just over $16 billion last year, is a big win for its early backers such as Japan’s SoftBank Group Corp and China’s Didi Chuxing.
A U.S. listing will give Grab extra firepower in its main market, Indonesia, where local rival Gojek is close to sealing a merger with the country’s leading e-commerce business Tokopedia.
Grab, whose net revenue surged 70% last year, is yet to turn profitable, but it expects its biggest segment – the food delivery business – to break even by end-2021, as more consumers shift to online food delivery after the COVID-19 pandemic.
With operations in eight countries and 398 cities, Grab is already Southeast Asia’s most valuable start-up.
Leveraging its ride-hailing business started in 2012, the firm has expanded into offering food and grocery deliveries, courier services, digital payments, and is now making a big push into insurance and lending in a region of 650 million people.