(Bloomberg) -- Grindr LLC, the dating app that specializes in connections for the LGBTQ+ community, has agreed to go public through a blank-check firm in a deal that values the combined company at $2.1 billion including debt.

The predominantly male dating app is merging with Tiga Acquistion Corp., which debuted in November 2020. The special purpose acquisition company isn’t offering any private investment in public equity, or PIPE, deals. The business combination will provide Grindr with an estimated $384 million, which the company will use to pay down debt and strengthen its balance sheet.

Grindr, based in West Hollywood, California, had been approached by a half-dozen SPACs prior to entering into the agreement with Tiga, Chief Financial Officer Gary Hsueh said in an interview.

“From our perspective, we’re ready to be a public company,” he said. The route through a SPAC rather than a traditional initial public offering “made more sense because it had certainty and that’s even more important today than it was a year ago when the market was different.”

The listing is a major step forward for the 13-year old company, which has had several owners over the years. Chinese firm Beijing Kunlun Tech Co. sold the company to San Vicente Acquisition Partners LLC for $600 million in 2020 after U.S. regulators urged a divestiture over national securities concerns.   

While rivals like Match Group Inc.’s Tinder and Bumble Inc. are LGBTQ+ friendly, Grindr is the most popular among members of the community. The app has about 11 million monthly active users, a fraction of the 100 million users across Match’s apps like Tinder and Hinge. Competitor Bumble Inc. had 40 million monthly users last year, according to company filings. Close to 80% of Grindr’s users are under 35. 

“The number of people who identify as part of the queer community has increased so dramatically,” Chief Executive Officer Jeff Bonforte said, adding that’s largely due to people feeling safer being able to embrace their identity. In the second half of the year, Bonforte plans to resign as CEO, as the company has identified a member of the LGBTQ+ community who has led a public company to serve in the role. The board will be made up of a majority of members who are LGBTQ+, a spokesperson said. Grindr declined to publicly disclose the name of the CEO candidate.

Like other dating apps, Grindr provides a free service with upgrades available for purchase. The app differs from its competitors as users can view and message the profiles of 100 people closest to them without having to match first. Grindr had 723,000 paying users as of the end of last December.  

Revenue excluding certain items grew to $147 million in 2021, according to the company, a 30% increase compared with the prior year, with adjusted earnings before interest, tax, depreciation and amortization coming to $77 million, a 51% increase. For this year, Grindr is forecasting adjusted revenue growth of 35% to 40% over 2021.

The majority of Grindr’s revenue is from subscriptions, while a smaller portion comes from ad revenue. The company has faced issues with user privacy as the Wall Street Journal reported that a digital advertiser sold location data that could compromise users’ identities. 

Grindr is choosing to go public through an investment vehicle that was once one of the hottest trends on Wall Street, drawing financiers, politicians and celebrities, who were able to make easy millions from investors piling into them. But, the shine is coming off after regulators outlined new plans aimed at tightening oversight of SPACs, including exposing underwriters to greater liability risk. Goldman Sachs Group Inc. is pulling out of working with most SPACs it took public, throwing into doubt the fate of billions of dollars raised for them, Bloomberg reported.

Grindr’s SPAC deal is expected to close by the end of the year pending regulatory and stockholder approval.

©2022 Bloomberg L.P.