The backdoor listing on Nasdaq marks the high point for the nine-year-old Singapore company that began as a ride-hailing app and now operates across 465 cities in eight countries, offering food deliveries, payments, insurance and investment products.
Grab’s rivals, including regional internet firm Sea and Indonesia’s GoTo Group, are also bulking up, with the region’s internet economy forecast to double to $360 billion in gross merchandise volume by 2025.
Grab was founded by Anthony Tan, its chief executive, and Tan Hooi Ling, who developed the firm from an idea for a Harvard Business School venture competition in 2011. CEO Tan, 39, expanded Grab into a regional operation with a range of services, after launching as a taxi app in Malaysia in 2012. It later moved its headquarters to Singapore.
“What we have shown to the world is that homegrown tech companies can develop great technology that can compete globally, even when international players are in town…we can compete and win,” Tan told Reuters. He said that Grab’s listing would help showcase the opportunity available to investors in Southeast Asia, a region of about 650 million people.
Grab’s listing brings a payday bonanza to early backers such as SoftBank Group Corp. and Chinese ride-hailing giant Didi Chuxing, which invested as early as 2014. They were later joined by others, such as Toyota Motor Co., Microsoft Corp. and Japanese bank MUFG. Uber became a Grab shareholder in 2018 after selling its Southeast Asian business to it following a five-year battle.
Analysts see scope for many players in Southeast Asia’s fragmented food delivery and financial services markets, but the road to profitability can be a long one.
In September, Grab cut its full-year adjusted net sales forecasts, citing renewed uncertainty over pandemic curbs on movement. Third-quarter revenue fell 9% and its adjusted loss before interest, taxes, depreciation, and amortisation widened 66% to $212 million. Grab said GMV jumped 32% in the quarter to a record $4 billion.
It aims to turn profitable on an EBITDA basis in 2023.
Grab said it completed its business combination with the SPAC, Altimeter Growth Corp. Grab will begin trading on Nasdaq under the ticker symbol “GRAB.”
Grab raised $4.5 billion alongside the SPAC transaction, including $750 million from Silicon Valley tech investor Altimeter Capital Management in a deal in April.