Home » Markets » Grab's $40B Nasdaq debut to set tone for Southeast Asian tech listings
Grab's $40B Nasdaq debut to set tone for Southeast Asian tech listings
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Grab, Southeast Asia's biggest ride-hailing and delivery firm, makes its market debut on Thursday after a record $40 billion merger with a special purpose acquisition company (SPAC), in a listing that will set the tone for other regional offerings.
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.
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The biggest U.S. listing by a Southeast Asian company follows Grab's April agreement to merge with U.S. tech investor Altimeter Capital Management's SPAC, Altimeter Growth Corp and raise $4.5 billion, including $750 million from Altimeter.
There is scope for many players in the fragmented food delivery and financial services markets in Southeast Asia, a region of 650 million people, but the road to profitability could be a long one, analysts say.
Grab's flotation "will provide a bigger cash buffer" to its "cash burn," S&P Global Ratings said in a note. But the company's "credit quality continues to be constrained by its loss-making operations, and free operating cash flows could be negative over the next 12 months."
Southeast Asia's internet economy is forecast to double to $360 billion in gross merchandise value by 2025, prompting Grab's rivals, including regional internet firm Sea Ltd and Indonesia's GoTo Group, to bulk up.