Ride-hailing company Grab Holdings Inc. is said to be in talks with a special-purpose acquisition company for a possible merger.
The company is planning to go public in a deal that could value the startup at more than $40 billion, sources familiar with the matter said.
Grab is currently in negotiations with a SPAC affiliated with Altimeter Capital Management, the sources said. If its plans go through, it could be among the largest deals.
Grab is said to be planning to raise between $3 billion and $4 billion through a private investment in a public equity transaction - or a PIPE deal.
These deals typically accompany a SPAC merger. Sources said the amounts involved could still change and both companies will still need to reach agreements with mutual funds and other potential investors.
During its last fundraising in October 2019, Grab was publicly valued at around $15 billion. Some of the company's largest backers included Toyota Motor Corp., Uber Technologies and SoftBank Group.
If the two companies merge and go public it will be a milestone for such transactions. Public listings through SPAC mergers have become a trend on Wall Street - with most companies now opting to go with this type of public listing as opposed to traditional initial public offerings.
Companies previously reluctant to go public have now lined up to combine with SPACs. The transaction is speedier and cost-effective compared to traditional initial public offerings.
The largest SPAC deal was the $16 billion merger between United Wholesale Mortgage and Gores Holdings IV in September. The largest so far this year was between Lucid Motors and Michael Klein's Churchill Capital Corp. The deal was estimated to be valued at nearly $12 billion, according to Dealogic.
Since the start of the year, a record $70 billion has been raised through SPAC mergers. This accounts for about 70% of all public stock sales this year.
Others interested in SPAC mergers are office-sharing company WeWork, online lender Social Finance and photo book maker Shutterfly.
