Oyo Hotels to raise $1.5 billion as part of funding round
A significant part of the funds will be diverted towards continued growth in the company’s fastest-growing market the United States
Oyo Hotels & Homes will be raising $1.5 billion for its Series F funding round. As a part of this round, RA Hospitality Holdings’ will invest approximately $700 million as primary capital in the company, with the balance $800 million being supplemented by other existing investors.
Officials revealed that a significant part of the funds will be diverted towards continued growth in the company’s fastest-growing market the United States, and in strengthening the company’s position in the vacation rentals business in Europe.
Earlier this year, RA Hospitality Holdings’ received CCI approval to invest $2 billion in OYO. In order to facilitate this transaction, Lightspeed Venture Partners and Sequoia, are selling part of their shareholding in OYO to help the Founder increase his stake while remaining invested and committed to the company’s long-term mission.
Prior to this, OYO had raised over $1 billion in its last financing round, announced on September 2018, led by SoftBank through SoftBank Vision Fund, with participation from existing investors Lightspeed Venture Partners, Sequoia and Greenoaks Capital and supported by new strategic partners like Airbnb.
Commenting on this development, Ritesh Agarwal, founder & ceo (Global), Oyo Hotels & Homes, said: “The continued support of our investors like Softbank Vision Fund, Lightspeed, Sequoia Capital is a testament to the love, trust and relentless support of our asset owners and customers, hard work of all OYOpreneurs, and our commitment to making #LivingTheGoodLife a reality for over 3.2 billion middle-income people around the world. With the CCI approval now in place, the company will get a capital infusion of approximately $1.5 billion to support this mission, supported by me and other shareholders.”
“I am also happy to share that on a YOY basis, we have seen that not only are we operating profitably at the building level but at the same time our EBITDA has also improved by 50% .The losses as a percentage of NRV have also been on a steady and significant declining curve. The growth across verticals in India and globally has been phenomenal and we truly believe that we will be able to build a truly global brand out of India, while ensuring that the business is run efficiently and with a clear path to profitability. Our immediate goal however is to make forward looking investments so we can achieve our mission, while delivering on our fiduciary responsibility to our investors by building a sustainable business,” added Ritesh.