Post by : Badri Ariffin

Grindr, the globally recognized LGBTQIA+ dating platform, is set for a potential ownership shift as two of its board members propose taking the company private in a deal valued at approximately $3.46 billion. The announcement sent shares soaring nearly 19% on Friday, reflecting investor optimism over the move.

The proposal comes from board members Ray Zage and James Lu, who, along with an investor group, already control over 60% of Grindr. If successful, the buyout would give them full control over the platform, which connects millions of users across more than 190 countries. The move is being seen as a strategic step at a time when the online dating industry faces slowing user growth and rising competition from AI-driven matchmaking apps.

Zage and Lu initially acquired Grindr in June 2020 and later led the company’s public listing in November 2022. Since then, the stock has experienced volatility, often trading below its debut levels, partly due to “swiping fatigue” among younger users.

The proposed $18-per-share offer represents a 51% premium over Grindr’s share price on October 10, when discussions of a privatization plan were first reported. The consortium behind the deal has already secured letters of interest and equity contributions to ensure financing, signaling a strong likelihood of the offer moving forward.

While the proposal falls slightly below some investor expectations, analysts note that the current growth challenges would have been difficult to overcome without several consecutive strong quarters. Industry peers like Match Group and Bumble are more focused on enhancing existing platforms than pursuing acquisitions, making Grindr a unique acquisition opportunity.

Grindr’s board has set up a special committee of independent directors to review the unsolicited offer and evaluate any committed financing, ensuring a thorough assessment before proceeding. The deal, if completed, could reshape the company’s strategic direction and its role in the evolving online dating market.

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