HONG KONG — Southeast Asia’s largest ride-hailing company, Grab Holdings, said Tuesday that it plans to merge with U.S.-based Altimeter Growth Capital in a deal that would value it at nearly $40 billion and allow it to trade on the Nasdaq Stock Market.
That would make it the largest SPAC merger ever, more than double current record-holder United Wholesale Mortgage’s $16 billion mergers in January.
The deal is the latest milestone in the booming business of SPACs, as investors race to find the next hot, young company when stock prices of big, established companies are already at a record. SPAC stands for “special purpose acquisition company” but is often better known as “blank-check companies.” With a SPAC, investors plug-in cash and then wait for it to find a privately held company to merge with, allowing the target to go public more quickly than if it went through a more traditional initial public offering.
According to a statement, in its SPAC deal, Grab is expected to receive about $4.5 billion in cash proceeds and will be valued at about $39.6 billion. Big institutional investors, including BlackRock, T. Rowe Price, and Fidelity, are also putting cash into the deal.