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Grab IPO, the world's largest SPAC deal.

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Southeast Asia's ride-hailing giant $Grab Holdings(GRAB.US)$ set to merge with US firm $Altimeter Growth Corp(AGC.)$ . According to Forbes, The transaction which will be the world's largest SPAC deal, which values Grab at $40 billion.
The company started out as a taxi-app, but it has been extending its services over time and expanding into grocery deliveries and financial services as the pandemic accelerated the adoption of e-commerce and other digital platforms. The company is now the dominant player in the region. However, intensifying competition and the company's huge losses also make investors think twice before putting a bet on it. No matter what the outcome, Grab will join $Sea(SE.US)$ and become one of the two Southeast Asia giant tech companies listed in the US.
Post to tell about your thoughts. Most importantly, guesswhat's going to be the closing price on its first day? Leave it in your post to win points!
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Place your bet on Grab's closing price of Dec 2 ET by Dec 2 3:30 PM ET / Dec 3 4:30AM SGT.
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What is SPAC?
10/26/2021 10:31
What is a SPAC?

ColumnThe lifecycle of a SPAC

According to theSEC filing, Singapore-based tech giant Grab will list on the NASDAQ on this Thursday (December 2nd)through SPAC.Investors voted to approve the merger of Grab Holdings Inc. and Altimeter Growth Corp. on November 30.Its $40-billion listing will mark the world’s largest SPAC deal.
What is SPAC?
A special purpose acquisition company (SPAC) , also known as "blank check company", is a company with
No commercial operations
Raising capital through an initial public offering(IPO)
Purpose of acquiring an existing company
A special purpose acquisitions company is essentially a shell company set up by investors with the sole purpose of raising money through an IPO to eventually acquire another company.
SPACs have been around for decades, but their popularity has soared in recent years. In 2020, 247 SPACs were created with $80 billion invested, and in just the first quarter of 2021, a record $96 billion1 was raised from 295 newly formed SPACs. By comparison, only two SPACs came to market in 2010.In 2020, SPACs accounted for over 50% of new publicly listed companies in the U.S.
How does SPAC work?
There are three distinct phases in the lifecycle of a SPAC:
Firstly, creating a SPAC and searching for a target:
A SPAC’s IPO is typically based on an investment thesis focused on a sector and geography, such as the intent to acquire a technology company in North America, or a sponsor’sexperience and background.
Usually a SPAC is created, or sponsored, by a team of institutional investors, Wall Street professionals from the world of private equity or hedge funds, while even high-profile CEOs have jumped on the trend and formed their own SPACs.
SPAC IPOs are usually priced at $10 a share. Following the IPO, proceeds are placed into a trust account. In some cases, some of the interest earned from the trust can serve as the SPAC's working capital.
When a SPAC raises money, the people buying into the IPO do not know what the eventual acquisition target company will be. In creating a SPAC, the founders sometimes have at least one acquisition target in mind, but they don't identify that target to avoid extensive disclosures during the IPO process (This is why a SPAC is also often called "blank check company"). Institutional investors with track records of success can more easily convince people to invest in the unknown.
When the target is announced:
Once a target company is identified and a merger is announced, the SPAC’s public shareholders may alternatively vote against the transaction and elect to redeem their shares.
If the SPAC requires additional funds to complete a merger, the SPAC may issue debt or issue additional shares, such as a private investment in public equity (PIPE) deal.
De-SPACing: The SPAC typically has18-24 monthsto identify and complete a merger with a target company, sometimes referred to as de-SPACing.
If the SPACdoes notcomplete a merger within that time frame, the SPAC liquidates and the IPO proceeds are returned to the public shareholders.
Information Disclosure:"Once formed, the SPAC will typically need to solicit shareholder approval for a merger and will prepare and file a proxy statement (or a joint registration and proxy statement on Form S-4 if it intends to register new securities as part of the merger).
This document will contain various matters seeking shareholder approval, including a description of the proposed merger and governance matters.
It will also include a host of financial information of the target company, such as historical financial statements, management’s discussion and analysis (MD&A), and pro forma financial statements showing the effect of the merger."
When the merger is closed:
Recently, shareholders of a SPAC company Altimeter Growth Corp voted in favour of the merger between Grab, the ride-hailing and delivery giant, and the listed shell company, paving the way for Grab to list in the US on Thursday (Dec 2).
In general cases, once shareholders approve the SPAC merger and all regulatory matters have been cleared, the merger will close and the target company becomes a public entity. After an acquisition, a SPAC is usually listed on one of the major stock exchanges.
A target company in a SPAC merger will need to prepare itself for being a public company normally within a few months, which is a shorter timeline compared to a traditional IPO for substantially the same preparation.Lock-ups for SPAC IPOs typically last 180 days to one year.
Information Disclosure:A Form 8-K, with information equivalent to what would be required in a Form 10 filing of the target company (commonly referred to as the Super 8-K), must be filed with the US Securities and Exchange Commission (SEC)within four business daysof closing.
The lifecycle of a SPAC
The lifecycle of a SPAC
The lifecycle of a SPAC

SPAC Altimeter Growth gains after holders approve deal to take Grab public

SPAC$Altimeter Growth Corp(AGC.US)$rose 3% in after hours trading after holders approved the deal to take Southeast Asian ride-sharing company Grab public.
Shareholder redemptions were almost 0%, at 0.02%, according to a statement. The transaction is expected to close tomorrow and Grab is expected to begin trading on the Nasdaq under the ticker symbol "GRAB" Thusday.
Grab is Southeast Asia's most valuable startup and is set to undergo a merger with Altimeter at a valuation of $40B.
The deal is expected to be one of the largest-ever U.S. equity offering by a Southeast Asian company. A public debut from Grab will offer investors access to a regional consumer market of more than 655M people across countries including Indonesia, Thailand and Vietnam.
Earlier this month, Brad Gerstner's SPAC Altimeter Growth announced that that the SEC declared effective the Form F-4 registration statement of Grab Holdings and set the shareholder vote for today.
SPAC Altimeter Growth gains after holders approve deal to take Grab public

ColumnSPAC-pedia | Grab will go public today through the largest SPAC merger

Southeast Asia's digital tech unicorn Grab will start trading on the Nasdaq under ticker symbol "GRAB" on December 2nd after Altimeter Growth Corp’s shareholders approved the merger with it.
According to a SEC document, the transaction—which will be the world's largest SPAC deal—will give Grab a valuation of $40 billion.
Grab will receive about $4.5 billion in cash, which includes $4 billion in a private investment in public equity arrangement.
Investors in the PIPE include funds and accounts managed or advised by BlackRock, Counterpoint Global (Morgan Stanley Investment Management) and T. Rowe Price Associates, Inc., as well as Fidelity International, Fidelity Management and Research LLC, Janus Henderson Investors, Mubadala, Nuveen, Permodalan Nasional Berhad and Temasek.
Grab: Southeast Asia's ride-hailing and delivery giant
JoyfulBusiness Overview
SoftBank-backed Grab, founded in 2012, is a Southeast Asia's leading superapp based on GMV in 2020 in each of food deliveries, mobility and the e-wallets segment of financial services, according to Euromonitor.
The company enables millions of people each day to access its driver- and merchant-partners to order food or groceries, send packages, hail a ride or taxi, pay for online purchases or access services such as lending, insurance, wealth management and telemedicine, all through a single “everyday everything” app.
Grab operates across these service sectors in over 400 cities in eight countries in the Southeast Asia region – Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
The company is the dominant player in the region of about 650 million people, though competition is intensifying from rivals such as Gojek, which merged with e-commerce company PT Tokopedia to bulk up.
It is also competing against Delivery Hero SE’s Foodpanda and Deliveroo Plc as well as new entrants such as AirAsia Group Bhd. in the region.
The company started out as a taxi-app, but it has been extending its services over time and expanding into grocery deliveries and financial services, as the pandemic accelerated the adoption of e-commerce and other digital platforms.
Earlier this month, GrabMart signed partnerships with supermarket and grocery chains across Indonesia, Malaysia, the Philippines, Thailand and Vietnam.
At the same time, it tied up with e-commerce firm Lazada to provide same-day delivery services to consumers in Singapore via GrabExpress.
JoyfulFinancial Performance
Grab generated revenue of $78 million and $396 million in the six months ended June 30, 2020 and June 30, 2021, respectively, representing a year-over-year growth rate of 406%.
Its revenue was $(845) million and $469 million in 2019 and 2020, respectively, representing a year-over-year growth rate of 155%.
According to Grab's final Form F-4, its revenue growth in 2020 and the six months ended June 30, 2021 was driven by an increase in GMV. Its GMV was $5.9 billion and $7.5 billion in the six months ended June 30, 2020 and 2021, representing a YoY growth rate of 28%.
The revenue growth in 2020 was also driven by a decrease in partner and consumer incentives from $2.4 billion in 2019 to $1.2 billion in 2020.
Its net loss was $(1.5) billion and $(1.5)billion in the six months ended June 30, 2020 and 2021, respectively. Net loss in 2019 and 2020 was $(4.0) billion and $(2.7) billion, respectively, representing a year-over-year growth of 31%.
AGC SPAC: Sponsored by institution with notable VC investments
Altimeter Growth Corp.(AGC.US) is a newly formed blank check company, an affiliate of Altimeter Capital Management which is a technology-focused investment firm.
Altimeter Capital has a proven track record of successfully investing in leading technology companies in both the private and public markets. According to its Form F-4,some of its prior investments include Expedia, Zillow, Facebook, Uber, AirBnB, ByteDance, AppDynamics, MongoDB, Okta, Twilio, Unity, and Snowflake.
Through the business combination, Grab could leverage Altimeter Capital’s investment team's capabilities, relationships, network, and deal pipeline to support it in the identification and diligence of potential targets.
Final F-4 Registration Statement of Grab
The lifecycle of a SPAC
$Altimeter Growth Corp(AGC.US)$$Grab Holdings(GRAB.US)$
SPAC-pedia | Grab will go public today through the largest SPAC merger
SPAC-pedia | Grab will go public today through the largest SPAC merger
SPAC-pedia | Grab will go public today through the largest SPAC merger
My personal thoughts are that the price action of $Altimeter Growth Corp(AGC.US)$/$Grab Holdings(GRAB.US)$ will be driven less by valuation/fundamental metrics and more by the intangibles. The emerging SEA market and its hot potential is very desirable for investors now, especially as a safer alternative to volatile China stocks. With few pure play ways available to invest there, AGC/Grab will certainly be a premium must have buy if not for its name recognition alone. After the merge I think the company will get a 9-12 month honeymoon show-me period before valuation metrics take the wheel and begin driving the share price.

Merger Days Be Like That

$Grab Holdings(GRAB.US)$$Astra Space(ASTR.US)$$Rocket Lab(RKLB.US)$ Rough one out there today but don't fret. Look at charts like ASTR, AUR, RKLB. All 3 were spacs and they followed the same pattern. In fact, all good spacs follow the same pattern.
Shoots high on DA - Shorted down due to length of time before merger - sits around $10 for awhile - iv is super low, you buy contracts well passed proposed merger date - merger rumblings and news - price shoots up - shorts cover with volume and on the way up while cashing in on calls.
In this case, like the others, the price fell through $10 on merger date but will start trading like a "real stock" next week. Merger is always weird.
Like the others, we are likely to see a 5% institutional buy or at least a lot of interested parties. This causes significant price moves up. Relax and enjoy if you're a long term investor.
If you bought contracts for December, shitttt. They still might be worth hanging on to since under $8 isn't likely to happen. I for one will wait for things to sort itself out, iv to chill, and then I'll buy back in.
2-3 year steady play.

Grab IPO: Q3 Performance Breakdown

$Grab Holdings(GRAB.US)$$Altimeter Growth Corp(AGC.US)$ Grab's Q3 adjusted net sales stand at $429mn, 22% decline QoQ. Grab's Q3 revenue also declined 13% QoQ. This implies incentives to consumers declined 27% QoQ. It is a comfort to see that revenue is less sensitive to consumer incentives. A more worrying sign would be increasing adjusted net sales (or incentives) and declining revenue. Since incentives to consumers declined more than revenue, there isn't evidence suggesting an anomaly or discrepancy. Rather, the decline is more likely to stern from the business environment, which is what Grab has reminded investors about in Q2.
In Q2, Grab warned investors about potential severe COVID19-related mobility restrictions in Southeast Asia. During the period, Grab's full-year 2021 projection has considered the potential of partial and total lockdowns in various countries where the company operates as a consequence of COVID19's continued expansion. Grab's fear came true as COVID cases in SEA countries reached a new all-time high in Q3 due to the Delta variant. The Philippines reimposed lockdowns on Sept. 9, a day after announcing the lifting of stay-at-home orders for more than 13mn people. In August, Vietnam has also imposed a strict stay-at-home order in Ho Chi Minh City's southern suburbs and dispatched the army to assist quarantined citizens.
Therefore, it is no surprise that Grab attributed the decline in overall revenue to the lockdown, especially in Vietnam. This claim is accurate. By referring to Table 1, we can see that the decrease in revenue is mainly derived from its mobility segment. If we expand our analysis time period, we can observe that Grab's underperformance (drop in revenue) in 2021 is caused mainly by its mobility segment. Grab's Q2 mobility segment revenue, and total revenue dropped $27mn and $35mn QoQ, respectively. Grab's Q3 mobility segment revenue and total dropped $30mn and $23mn QoQ, respectively. The decline in the mobility segment coincides with increases in COVID19 cases across SEA (Figure 4). Therefore, Grab's claim that its decline in revenue is contributed by the lockdowns and travel restrictions across SEA.
Despite the drop in revenue, activities (GMV) on the company's platform actually increased 5% during the period. This may not seem like a big deal, but this statistic actually invalidated one of our previous hypotheses (maturing market). In Q2, Grab's GMV only increased 6.5% in spite of a 27% increase in incentives. This suggested that Grab's market is reaching maturity. However, Grab's GMV increased 4.1% (QoQ) in spite of a 27% (QoQ) decline in Q3. This means that Grab's GMV growth isn't fueled by incentives as much as initially thought.
Following Grab's narrative, monthly transacting users (MTU) also declined due to lockdowns. This is also expected. However, what was unexpected is GMV per MTU actually increased. This further proves that Grab indeed has a network effect where activities (GMV) of existing users increase. This is crucial to Grab's overall growth for several reasons:
It is unlikely for Grab to expand beyond SEA. This is because Grab, Uber, and DiDi (NYSE:DIDI) share equity with one another. Therefore, it is unlikely for them to compete with one another.
Due to the limited geographical expansion, it is clear that Grab has to upsell and cross-sell new products to the existing userbase to increase the revenue stream.
For these very reasons, Grab's increase in GMV and GMV per MTU is a positive takeaway. With UBER as comps, Grab has to grow at 35% CAGR on top of a fully recovered pre-pandemic mobility segment over the next five years. This feat is very challenging. Firstly, the majority of Grab's revenue is derived from its mobility segment. Based on the relationship between COVID19 cases and Grab's mobility segment (Figure 4 and Table 1), we expect Grab's Q4 mobility segment to be in between Q1's and Q2's, somewhere around $135mn. This figure only represents around 6.75% of the pre-pandemic level (approximately $2bn). Hence, there is still a very long way to go. Secondly, we don't expect food delivery to grow materially from here as we expect the need for food delivery to decrease when the economy reopens. Hence, food delivery is not expected to contribute to Grab's overall growth. Thirdly, financial service and enterprise & new initiatives' overall contribution to revenue is only marginal. Hence, it is difficult to justify Grab at its current $52bn valuation.
Moreover, investors will lose the $10 NAV safety net once the Grab-AGC merger is completed. This adds to investors' downside risks. In addition, the overall macroeconomy conditions add to the difficulty in investing in high-growth companies. High inflation erodes the value of future earnings, while any form of tapering or rate hikes will devalue Grab's intrinsic value.
Grab IPO: Q3 Performance Breakdown
Grab IPO: Q3 Performance Breakdown
i guess closing price will be $25.1
for $Grab Holdings(GRAB.US)$
this is a good company and i used its service almost everyday
i am a malaysian, i am proud of this company founded in Malaysia can be listed in Nasdaq too. Drool
$Grab Holdings(GRAB.US)$ When it comes to food delivery, I wonder if any comparisons to China are entirely valid. So much of SEA's food tends to be home-cooked, often with gravies, which is a likely natural competitor to 'drier' foods preferred by Chinese customers, from fast food chains to their own cuisines.
Going forward, isn't increased fuel costs a major headwind for Grab?

Grab is considered a successful, attractive company

$Grab Holdings(GRAB.US)$ Its quarterly losses, particularly during a turbulent pandemic time, when various branches of the business are going up and down in tandem with national restrictions, are not a worry.
Nor was its 20 per cent tumble on the launch day of the IPO. As Grab co-founder Anthony Tan presciently quipped after the bell rang: “The stock will go up and it will go down” — as he saw his personal wealth enter and depart billionaire territory within a few hours.
But that wasn’t the point of the IPO. The point was to raise another US$4.5 billion to continue fuelling Grab’s growth in the next few years, in the hopes of more financial stability after 2023.
$Sea(SE.US)$ , for example, traded below its IPO price for a year after its debut in 2017 at just US$15. This year, they peaked at over US$350, despite the fact that its Shopee platform keeps bleeding money.
Even after sliding to US$260, analysts retain forecast of close to US$400 — 26 times of what the company was worth four years ago.
The company started as a taxi hailing app, creeping up to become an Uber competitor, later moving into food delivery only to see this business explode and dwarf the mobility branch amidst the pandemic lockdowns.
The birth of GrabMart and grocery deliveries — with GrabFinance wrapped around all of these — offers another layer of digital finance services, allowing Grab to become a superapp people will use for far more than just moving from point A to B.
Just like how $Amazon(AMZN.US)$ started with selling books, before it became the world’s largest e-commerce retailer, cloud service provider and, recently, a full-on entertainment outfit making multibillion dollar shows (like the latest take on the Tolkien’s saga), companies like Grab are seen for the opportunities access to millions of willing buyers gives them, not their current operations.
A dollar spent (even a borrowed one) on growth into new markets and new services, gives a promise of a future return far outweighing the current expenses.
Grab is considered a successful, attractive company

🐂🍺Congrats on the listing

Singapore hawker culture is struggling during the pandemic period with tightened restrictions and going digital was one of the ways to help the hawker community to stay afloat. For a homegrown company, $Grab Holdings(GRAB.US)$ had extended support and taught the hawkers a new skill set by going digital to extend reach to more customers. I'm proud to see it go public similar as $Sea(SE.US)$ and hope it will continue to support small businesses across South East Asia 🍀
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