Singapore's Grab said on Tuesday it would acquire buy now, pay later (BNPL) provider Atome Financial in a deal that could ultimately value the target at up to $4.5 billion, accelerating its expansion in Southeast Asian consumer lending.
The acquisition comes as Grab seeks to deepen its financial services business alongside its ride-hailing and delivery operations to contend with rising operating costs through higher-margin products.
Grab will take an initial 60% stake in Singapore-based Atome for $1.49 billion, combining the target's BNPL loans, consumer cash loans, BNPL cards and digital lending with its own financial services business.
The company also agreed to acquire the remaining 40% stake about two years after the transaction closes under a performance-linked framework tied to Atome's EBITDA and revenue. The arrangement values Atome at between $2 billion and $4.5 billion.
The transaction is expected to complete by the third quarter of 2027.
REGIONAL EXPANSION
Grab President and Chief Operating Officer Alex Hungate said the acquisition would allow the company to rapidly expand BNPL services across the region.
While Grab has developed BNPL products in Malaysia and Singapore, buying Atome would allow it to "leapfrog the timeline" for expansion into the Philippines, Indonesia and Thailand, he said.
Grab first launched its own interest-free instalment product for consumer purchases in 2019 under a joint venture with Japanese credit card company Credit Saison.
Acquiring Atome would allow Grab to focus on scaling the business rather than spending years developing credit models and absorbing the losses often required to refine them, Hungate said.
He added that the company could leverage its three digital banks to lower the cost of funding for Atome's assets.
The company operates in more than 900 Southeast Asian cities and runs licensed digital lenders in Singapore, Malaysia and Indonesia.
Alongside the deal announcement, the company raised its 2028 targets, forecasting adjusted EBITDA of $1.7 billion and annual revenue growth of more than 30% between 2025 and 2028.
Grab CFO Peter Oey said: "Subject to closing timelines, we expect Atome Financial, along with the rest of our Financial Services segment, to generate an adjusted EBITDA of $500 million by 2028 with a combined gross loan portfolio of over $6 billion."
Jianggan Li, chief executive of Singapore-based consultancy Momentum Works, said Grab was effectively buying time and scale.
"Consumer credit in Southeast Asia is increasingly sitting inside large commerce platforms or major wallet ecosystems. As underwriting and collection increasingly become commoditised, distribution becomes more important," he said. - Reuters
