Grab spotlights SPAC deal growth forecast folly

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A man walks past a Grab office in Singapore March 26, 2018. REUTERS/Edgar Su/File Photo/File Photo - RC2YWN9XQXJ5

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MUMBAI, June 10 (Reuters Breakingviews) - Overly bullish growth projections are common in acquisitions by blank-cheque firms. Early numbers from the largest-ever special-purpose acquisition company merger seem to fit the bill. Less than two months after Altimeter Growth (AGC.O) valued read more SoftBank-backed (9984.T) Grab at $40 billion, the Southeast Asian ride-hailing-to-delivery group’s first-quarter business update suggests it’s tracking below its own expectations by one key metric.

The Singapore-based company’s gross merchandise value hit $3.6 billion in the March quarter. Annualised, that’s 15.2% higher than the actual figure for all of 2020, less than half the pace Grab hopes to deliver this year. Its mobility business is performing below pre-pandemic levels. Neither revenue nor profit were disclosed.

There were some promising signs: Users appear to be spending more, the GrabMart everyday goods delivery business grew GMV 21% quarter-on-quarter and the company’s direct-lending platform disbursed over 45% more credit.

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Grab has time to up its game: It also used its update to reveal that the takeover by Altimeter has been delayed to the fourth quarter. (By Una Galani and Sharon Lam)

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SIGN UP FOR BREAKINGVIEWS EMAIL ALERTS: <a href="" target="_blank"></a> Column by Una Galani in Mumbai, Sharon Lam in Hong Kong. | Editing by Antony Currie and Katrina Hamlin

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