Grab Blazes Trail For Asian Super-App Listings

The Grab IPO will mark a milestone for the Southeast Asian tech sector, which is forecast by one research group to triple in size by 2025, to $300 billion.

Grab, Southeast Asia’s answer to Uber, announced in mid-April that it’s planning to go public in the coming months, at a targeted valuation of nearly $40 billion. The deal may be the first of several long-anticipated tech launches from the region.

Founded in Malaysia as MyTeksi in 2012 and now headquartered in Singapore, Grab started off as an Uber-style ride-hailing app. It rapidly evolved into a “super app,” offering food delivery, digital payments and financial services to around 200 million users in Southeast Asia.

Grab plans to go public via a merger with a New York-listed SPAC, in what would be the largest blank-check structure transaction yet. Altimeter Growth, a late-stage tech company investor, will put in $500 million. A collection of blue-chip investors, including asset managers T. Rowe Price and Fidelity, have lined up to put in $4 billion as a private investment in public equity, or “PIPE.”

The Grab IPO will mark a milestone for the Southeast Asian tech sector, which is forecast by one research group to triple in size by 2025, to $300 billion. The region has relatively few digital/tech unicorns, and there is just a handful of traded Southeast Asian tech stocks.

Investors in Grab include Japanese heavyweight SoftBank and Uber, which took a stake in 2018 when Grab acquired Uber’s Southeast Asia business. Uber also owns a stake in Chinese ride-hailing giant Didi Chuxing. Borrowing from the playbook of Facebook’s Mark Zuckerberg, Grab CEO and founder Anthony Tan will control just over 60% of the company’s voting rights after the transaction—though he’ll own only 2.2% of the shares.

There’s more action to come in this sector. In the wake of Grab’s announcement, two of Indonesia’s biggest tech companies—super-app Gojek and e-commerce giant Tokopedia—announced a merger, pending shareholder approval. The combined entity, which will be called GoTo and has an estimated valuation that ranges from $18 billion to $40 billion, will be about 60% owned by Gojek, a major Grab competitor. Gojek and Grab discussed joining forces earlier this year, but the talks may have been derailed by regulatory concerns about monopolistic practices. GoTo and fellow Indonesian unicorns travel app Traveloka and e-commerce marketplace Bukalapak are said to be laying the groundwork to go public in the US later this year.