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A Southeast Asian ride-hailing company is in talks to go public through a special purchase acquisition company (SPAC), according to a report in The Wall Street Journal.
According to the publication, Grab Holdings could merge with one of two SPACs being led by Altimeter Capital Management LP in a deal that would value the Singapore-based company at $35 billion to $40 billion.
The news comes just more than a month after Reuters reported Grab was considering a U.S. initial public offering (IPO) this year. The Reuters report suggested the IPO could raise at least $2 billion for the company. Grab is backed by SoftBank Group Corp. and Mitsubishi UFJ Financial Group.
Grab offers ride-sharing, food delivery, payments and insurance in Southeast Asia, and it has signed a digital bank license in Singapore to offer banking services. In February, Grab closed a $2 billion term loan facility. JP Morgan served as the lead while Barclays, Deutsche Bank, HSBC, Mizuho, MUFG and Standard Chartered also were part of the round.
See also: How to Invest in SPACs
"I am deeply encouraged by the trust placed in us by investors who believe in our mission and recognize the value of our super app platform, as we continue making consistent progress in achieving our growth and sustainability milestones. With their support, we will invest in building a long lasting, multi local services business, so that millions of Southeast Asians can support their families and improve their lives with our everyday services," Anthony Tan, group CEO and co-founder, said in a statement.
According to the Journal, the SPAC merger would net Grab between $3 billion and $4 billion in private investment in public entity (PIPE) funding, which is a funding round that is typically included in a SPAC merger.
The Journal was unable to determine which of the two SPACs Altimeter would use for the merger. The company raised $450 million in a blank check IPO in October, and in early January, added a second, Altimeter Growth Corp. 2 (AGC 2), valued at $400 million.
AGC 2 (NYSE: AGCB) is led by Brad Gerstner, founder and CEO of Altimeter Capital. The Silicon Valley Business Journal reported that AGC 2 was seeking a technology company to take public through a reverse merger.
Altimeter has previously invested in UiPath, Modern Treasury and Workato and in January co-led a $520 million funding round in gaming company Roblox, which went public on Wednesday.
Grab was most recently valued at $14.3 billion, according to CB Insights. It has raised $12.1 billion in total funding, according to Crunchbase. Softbank has invested at least $1.5 billion. In 2018, Grab acquired Uber's Southeast Asian business, but Uber acquired a 27.5% stake in Grab through the transaction. According to reports out of Asia, if Grab does not go public by 2023, it must pay Uber $2 billion.
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