Grab’s Valuation In Question After SPAC Partner Altimeter Plummets 28 Pct

Altimeter, a blank-check company in charge of merging with delivery giant Grab, is just a few cents above its record low after bottoming at 28 percent since a deal went through in April, Bloomberg reported.

Altimeter closed at $11.06 Thursday (May 13), which was only a bit above the $10.98 of the historical low, according to Bloomberg. The selloff came right above the deal Grab reached on April 14 with Altimeter, with the project being the largest ever completed with a special purpose acquisition company (SPAC).

Grab, based in Singapore, is likely to have a market value of around $39.6 billion, Bloomberg reported.

Nirgunan Tiruchelvam, head of Consumer Sector Equity Research at Tellimer in Singapore, told Bloomberg that the reason for the precipitous price drop could be connected to the skittishness of investors on the valuation for Grab. There is also perception that the larger SPAC market is weak.

The company will be raising over $4 billion from investors, including BlackRock, Fidelity International and T. Rowe Price Group, Bloomberg reported.

“SPACs have seen a bit of selloff, so it reflects the general sentiment,” said Angus Mackintosh, founder of CrossASEAN Research, per Bloomberg. The share price at current levels won’t make a big difference from Grab’s listing perspective, he added. “It just means profits your SPAC owners would realize are diluted to some extent. They have effectively locked in cornerstone investors at a $40 billion valuation. Whether Grab can sustain that lofty valuation after listing, given the competitive landscape, is a bigger question.”

SPACs have been going strong but are slowing in terms of new deals, with only five blank-check companies submitting registration documents in the final week of April, according to Bloomberg.

PYMNTS reported in April that Grab would go public on the Nasdaq. The app has broadened its services to become somewhat of a catch-all app, including a singular portal for ride-hailing and food delivery along with microfinance.