Microsoft invests $5 million in SoftBank-backed Oyo ahead of its expected IPO

Microsoft invested $5 million (about Rs. 37.15 crores) in Oyo, backed by SoftBank, according to a regulatory document, ahead of the Indian hotel chain’s plan to go public.

Oravel Stays Pvt Ltd (Oyo) approved on July 16th the issuance of shares and convertible cumulative preferred shares in the amount of Rupees equivalent to $5 million to Microsoft in a private placement, pursuant to a registration of Oyo with the Registry of Companies.

Last month, a source familiar with the matter told Reuters that Microsoft was in advanced talks to invest in Oyo at a valuation of $9 billion.

The hotel aggregator, in which the Japanese conglomerate SoftBank owns 46 percent of the shares, endured months of layoffs, cost cuts and losses during the COVID-19 pandemic.

But as travel restrictions have eased and vaccines have increased, travel demand is slowly recovering in India, with local tourist attractions witnessing increased traffic.

In early July, Oyo founder and CEO Ritesh Agarwal said the company would consider a possible public offering, but did not provide a timetable.

India is currently witnessing an IPO frenzy. In July, food delivery company Zomato had a stellar debut. Paytm, financed by Berkshire Hathaway Inc., and Ola, which is also supported by SoftBank, are among other Indian startups looking to enter the markets.

Last week, a financial news website reported that Oyo had selected JP Morgan, Kotak Mahindra Capital and Citi for an initial share sale of more than $1.2 billion. Oyo did not respond to a request for comment on the report.

(Except for the title, this story has not been edited by the NDTV team and is published from a press release)


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