SINGAPORE - Super-app Grab Holdings made an encouraging market debut on Thursday (Dec 2), after completing its US$40 billion (S$54.7 billion) merger with special purpose acquisition company (Spac) Altimeter Growth Corp.
Shares of the combined entity opened at US$13.06 on its debut on the tech-heavy Nasdaq exchange on Thursday, up 18 per cent from the Altimeter Spac's closing price of US$11.01 on Wednesday.
Grab's shares rose as much as 21 per cent minutes after the listing before retreating to close 20.5 per cent lower at US$8.75.
The Singapore-headquartered firm, which began as a ride-hailing app and has since expanded into delivery and financial services, marked its Wall Street listing with a bell-ringing ceremony at the Shangri-La Singapore on Thursday.
Group chief executive and co-founder Anthony Tan told the gathering that the firm held the event in Singapore - Nasdaq's first opening bell ceremony held in South-east Asia - so that it could celebrate the milestone with everyone who has been with Grab through the years.
"Today, we shine a spotlight on South-east Asia and how its home-grown tech companies are powering new possibilities for the region's 660 million people," he noted.
Grab's listing is the biggest by a South-east Asian company.
It has allowed Grab to raise US$4.5 billion, including US$4 billion in a private investment in public equity arrangement led by United States tech investor Altimeter Capital Management.
Grab, co-founded by Mr Tan and Ms Tan Hooi Ling in 2012, now operates across 465 cities in eight countries in the region.
It was South-east Asia's leading super-app based on gross merchandise value in the food deliveries, mobility and e-wallets segment of financial services in 2020.
Several Grab delivery and merchant partners were also at Thursday's event at the Shangri-La, including Mr Melvin Chew, owner of Hawkers United and Jin Ji Teochew Braised Duck & Kway Chap.
Mr Chew said he appreciated how Grab supported the hawker community during the pandemic, helping hawkers pick up digital skills to reach more customers.
"I'm proud to see (Grab) go public today and hope it will continue to help small businesses across South-east Asia," he added.
National University of Singapore Business School's Professor Lawrence Loh told The Straits Times that Grab's listing will allow it to grow and provide an even greater suite of offerings for consumers, such as digital banking.
But he also sounded a note of caution: "The listed Grab will face two key tensions - price pressure from competitors and profit pressure from shareholders.
"Grab will have to delicately balance its market share building strategy with the newly escalated challenge of showing profitability."
Last month, Grab reported deeper losses of US$988 million for its third quarter, compared with US$621 million a year earlier.
The firm said it aims to turn profitable on an Ebitda (earnings before interest, taxes, depreciation and amortisation) basis in 2023.