Grab’s Huge SPAC Merger Heralds Asia’s Next Tech Boom

For Southeast Asia’s technology industry, Grab Holdings Inc.’s record-breaking deal to go public via a SPAC is a watershed moment.

Bankers and investors have long talked up Southeast Asia’s potential, and venture-capital funds have poured billions of dollars into the region. But so far, few of those investments have translated into big paydays from large listings or takeovers. And stock-market investors have had few ways to get in on the action, apart from the gaming and e-commerce group Sea Ltd.

With Grab, a Singapore-headquartered ride-hailing and delivery company, set to join Sea on the Nasdaq Stock Market, that is changing fast. Meanwhile, two other heavyweights, Gojek and Tokopedia, are working on a merger that could be a prelude to another big listing.

The $40 billion Grab deal “will attract a lot of investor attention and interest in the market,” said Chua Kee Lock, chief executive of Vertex Holdings. Vertex is the venture-capital arm of Singapore’s Temasek Holdings, and was Grab’s first institutional investor. “Before Grab, nobody made money from investing in Southeast Asia startups other than Sea,” he said.

Mr. Chua said today’s Southeast Asia is like China about 15 years ago, when the country’s first batch of startups went public in the U.S. and caused a splash. Chinese giants such as Tencent Holdings Ltd. , Alibaba Group Holding Ltd. and JD.com Inc. now rank among the world’s biggest tech firms.