According to a Semafor report, the main stakeholders of Grindr are urgently seeking to take the LGBTQ+ dating platform private after a drop in its stock price led to significant personal financial troubles.
The individuals involved are Raymond Zage, a former hedge fund executive and American expatriate residing in Singapore, and James Lu, a Chinese-American business leader with previous roles at Amazon and Baidu. The duo spearheaded the purchase of Grindr from Chinese owners in 2020 for upwards of $600 million, later bringing the company to the public market in 2022 via a special purpose acquisition company.
It is reported that Zage and Lu, who together own over 60% of Grindr, used nearly all of their shares as security for personal loans from a branch of Singapore’s sovereign wealth fund, Temasek. When Grindr’s stock began to fall at the end of September, the value of their collateral dropped below the loan amount, prompting Temasek’s unit to take possession of and sell some of their shares last week.
Semafor points out that the decline in Grindr’s stock price does not seem to reflect its underlying business performance—profits rose by 25% in the second quarter. However, the company has experienced some changes in its executive team, and investors have expressed worries about shrinking profit margins.
Regardless, the two are reportedly negotiating with Fortress Investment Group—which is now primarily owned by Mubadala Investment Company, itself under the ownership of Abu Dhabi’s government—to arrange funding for a buyout at approximately $15 per share, putting Grindr’s valuation near $3 billion. The news caused the stock price to rise.
