A significant part of the funds will be diverted towards continued growth in OYO’s fastest-growing market the United States, and in strengthening the company’s position in the vacation rentals business in Europe.
OYO Hotels & Homes said it is raising $1.5 billion as part of its Series F funding round. As a part of this round, founder Ritesh Agarwal will infuse approximately $700 million in the company as primary capital through RA Hospitality Holdings, with the balance $800 million coming from other existing investors led by SoftBank. The company's valuation touches $10 billion with this fresh infusion, sources said.
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A significant part of the funds will be diverted towards continued growth in OYO’s fastest-growing market the United States, and in strengthening the company’s position in the vacation rentals business in Europe, the company said.
Agarwal, Founder & CEO (Global) of OYO Hotels & Homes, had raised $2 billion for a buyback through RA Hospitality Holdings and had received CCI approval last month. Agarwal bought back shares worth $1.3 billion from Lightspeed Venture Partners and Sequoia with the capital, while the rest was used for primary infusion. 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.
OYO has expanded its presence to 80+ countries around the world. In China, Oyo has a presence in 338 cities with over 590,000 rooms, in Indonesia it is present in 100+ cities and over 27,000 rooms, in the UK it has a presence in 30 destinations and over 3,500 rooms, and in the US, with presence in 60 cities, 21 states and over 7500 rooms.
The company said that it has seen a 3.8x YoY growth in revenue in August 2019 (vs. August 2018), with 1.2 million rooms under management across hotels and homes. The company said it has a strong balance sheet of about $2 billion across group companies, a significant part of which will be further invested in the business, given the company’s focus on maintaining its growth momentum.
“The continued support of our investors like Softbank Vision Fund, Lightspeed and 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," Agarwal said in a statement.
First Published: Oct 7, 2019 3:47 PM IST