Ride-hailing firm Grab Holdings is reportedly planning to go public through a merger with a U.S. Special Purpose Acquisition Company (SPAC). If the deal materializes, Grab’s value will hit almost $40 billion, people familiar with the matter told Reuters.
Grab, backed by firms like SoftBank, is believed to be in talks with Altimeter Capital Management alongside two other SPACs. Altimeter already has Altimeter Growth Corp and Altimeter Growth Corp 2 SPACs, which raised $450 million and $400 million in IPO respectively.
However, it is not clear which Alitmeter’s SPACs Grab was in talks with. Grab will potentially raise between $3 billion and $4 billion from private investors in the SPAC merger.
Grab, which has expanded into food delivery, actively considered the idea of listing a U.S. IPO from January this year with plans to raise $2 billion.
Wall Street banks to advise on SPAC deal
The firm hired the services of J.P. Morgan Chase and Morgan Stanley as advisors in the deal. Plans to go public took shape after Grab’s alleged merger with its Indonesian rival Gojek collapsed.
Grab seeks to leverage the growth of SPACs over the last year after attracting massive investments. For instance, in 2020 alone, sovereign funds invested at least $1.79 billion in SPACs.
SPACs’ popularity comes from the fact they have attractive upside potential for a relatively small investment of capital.
Recent high-value SPACs deals include the $16 billion mergers of UMW Holdings with a firm supported by billionaire Alec Gores. Electric vehicle manufacturer Lucid Motors also reached a $24 billion deal with a Michael Klein-backed SPAC.