5 SPACs Making Waves in Southeast Asia


Southeast Asia’s unicorns are tapping into the exploding SPACs scene

Special Purpose Acquisition Corporations (SPACs) are booming at the moment. Several unicorns are looking to go public, following a rush of fundraising on Wall Street last year. Southeast Asia has prime candidates for these companies, especially its billion-dollar names.

SPACs operate with the intention of acquiring and merging with companies to trade on the stock market. They have no commercial operations at the time of listing. By attracting investments as a blank-check company, they hope to merge with other businesses and take them public. Target companies to merge with are not decided during negotiations for funding. Because of this, investors have no certainty that the SPAC will be successful.

The most attractive aspect of SPACs is that companies can go public by surpassing the more time-consuming traditional IPO approach. SPACs can circumvent much of the regulatory hassle and negotiations that come with a traditional IPO. There is much less risk, which is proving to be inviting for many investors.

For all this and more, SPACs have become an enticing way to go public, and Southeast Asian startups are riding the trend.


Sector: Multi-service superapp

Valuation: US$39.6 Billion

Grab is one of Southeast Asia’s most valuable startups, and is set to be a part of a large merger. The ride-hailing service, which now operates food delivery and digital payments wings, grew to become one of the region’s earliest decacorns, valued at over $10 billion.

Although there were talks of a merger between Grab and another Southeast Asian superapp Gojek, these fell through. Grab has since changed course and announced its SPAC merger with Altimeter Growth Capital. This is their move to go public with a current valuation of $39.6 billion. In addition to a Nasdaq listing, Grab is also considering listing on the Singapore Exchange (SGX). This move would situate their second listing closer to their home market.

Gojek and Tokopedia (Goto)

Sector: Multi-service superapp

Combined Valuation: $18 Billion

Tokopedia caused just as much a stir when it officially started its process to go public late in 2020. The company’s original plan was to merge with the blank-check company Bridgetown Holdings. However, Tokopedia’s plans changed when Gojek became a potential partner to merge with before going public.

Reports suggest that Gojek and Tokopedia, are finalizing a $18 billion deal, merging into the combined company “Goto”. The news came soon after reports that the Grab-Gojek merger was off the table. As of now, the deal suggests Gojek shareholders will hold a 58% stake in Goto, whereas Tokopedia shareholders will hold the remaining 42%. Gojek Co-CEO & Co-founder Kevin Aluwi is expected to head the new company. All this is taking place before the merged group plans to ultimately list in both Jakarta and the U.S.


Sector: Travel tech

Valuation: $4.5 Billion

Traveloka is another unicorn that has been considering the SPAC approach to going public. The online travel and bookings company has reportedly been in discussions with Bridgetown Holdings, the same group which would have originally merged with Tokopedia. This comes after a difficult 2020 for the travel and tourist bookings company. Despite the struggles that COVID-19 brought to the travel industry, the company is reportedly profitable again.

Traveloka’s discussions with Bridgetown Holdings could leave them with a valuation of about $5 billion, Bloomberg reported. It also said that this deal would involve raising between $500-$750 million in a private investment in public equity.


Sector: Ecommerce

Valuation: $3.5 Billion

Indonesian-based Bukalapak is the next big ecommerce shopping platform in the country, after Shopee and Tokopedia, and is shaping up to go public soon. It has been reported that the firm has been exploring the possibility of going public but hasn’t settled on a company at the time being. The Microsoft-backed company is also considering possibility of a dual listing on both the Indonesian and U.S. markets.

It’s initial steps towards going public are less concrete than its larger competition. Bloomberg reports that the company is in talks with investment banks and blank-check companies as they work out a plan. They are looking at a potential valuation of $4 to $5 billion, the report further stated.

SPACs Are Not Guarantees

As more players of different sizes make plans to go public via SPACs, the ecosystem will only continue to snowball. Since the beginning of the year, SPACs have held the spotlight. That Southeast Asia’s biggest startups are choosing to go public through them further underlines the popularity that SPACs are currently enjoying.

It is worth noting that SPACs are not an assured success. While they bypass certain requirements to go public faster, they are expected to acquire a company within two years of being formed, or else they face liquidation.

Sponsors of the SPAC have a lot of power during the negotiation process. These sponsors are the ones who raise the initial funds to purchase and merge with companies in the future. Their role gives them bargaining power., because initial investors are betting on sponsors of the SPAC rather than the company itself.

It’s important to keep this in mind as these early discussion will fix the price of the SPAC merger. In some cases, this can lead to SPACs being mispriced. Because SPACs are pressed to find quality companies within two years, especially during booms like the one that is currently underway, these negotiations with sponsors are key.

Thus, the ability to go public via SPAC is inviting for a lot of investors and companies, but does not remove the risks involved. Even so, the Southeast Asian market is capitalizing on its potential.

Header image courtesy of Grab


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