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Grab, the Singapore-headquartered superapp that evolved from ridesharing into food delivery and financial services, is jumping on the blank check bandwagon with a merger with Altimeter Growth Corp. 2 at around a $39.5 billion valuation.
The deal, according to CNBC, is the largest merger for a special purpose acquisition company to date. Softbank, along with Uber, are major Grab investors. When the merger is complete, Grab will trade on Nasdaq under the GRAB symbol.
Special purpose acquisition company Altimeter Growth Corp. 2, which is chaired by longtime travel and tech investor Brad Gerstner and has Expedia founder and Zillow CEO Rich Barton on its board, did an initial public offering on January 11 as it hunted for potential merger partners.
Altimeter Growth Corp. 2, one of Gerstner’s two blank-check companies, would provide Grab, the leading superapp in Southeast Asia, with $4.5 billion in cash proceeds in the merger transaction.
“We found this was the better way to IPO,” Grab CEO Anthony Tan told CNBC Tuesday about the Altimeter merger. “They committed more than 15 percent of our PIPE (Private Equity in Public Investment), and that shows real commitment.”
"We found this was the better way to IPO," says Grab CEO Anthony Tan on going public through a SPAC merger with @altcap's $AGC. "They committed more than 15% of our PIPE, and that shows real commitment." pic.twitter.com/giXMEFofVb
— Squawk Box (@SquawkCNBC) April 13, 2021
The transaction unites three impactful figures in the history of online travel — Gerstner, Barton, and Dara Khosrowshahi.
Former Expedia Group CEO Dara Khosrowshahi’s Uber has a substantial equity stake in Grab, a transaction that occurred when Uber bowed out of Southeast Asia in 2018 and sold its business there to Grab. Uber CEO Khosrowshahi is a board member of Grab and Expedia Group.
Gerstner was the co-CEO of cruise and vacation packager National Leisure Group a couple of decades ago, and his Altimeter Capital has been a major travel investor.
Barton is an angel investor and a member of the blank check company’s board.
“Altimeter partners with companies at all stages of growth — and provides expert advice as they cross into the public markets,” Gerstner told Skift Tuesday. “And this transaction validates that the Altimeter Capital Markets platform (leveraging our SPACs) — what we call the Altimeter Founders IPO — is now a powerful alternative way for the best internet and software companies in the world to bring their listing to the public markets.”
Up until this point, the blank check company had no meaningful operations as it shopped for a potential partner. The Wall Street Journal reported last month that an Altimeter-Grab union was likely.
AirAsia Group is in the initial phases of attempting to turn itself into an airline plus a lifestyle company, a move that could potentially provide some nascent competition to Grab. AirAsia Digital offers food and other delivery, financial services, shopping, and intends to debut a rideshare service.
Note: Skift updated the story to detail that the deal is the largest SPAC merger to date, and to note that Softbank is a major Grab investor.