Oyo will see promoter Softbank Vision Fund, Hero Enterprise's Sunil Munjal, and Singapore's ride-hailing company Grab selling shares as part of the Rs 1,430 crore Offer for Sale in the hospitality company's Rs 8,430 crore IPO.
Oyo has filed a draft red herring prospectus (DRHP) with market regulator Sebi to raise Rs 8,430 crore by floating an initial public offering (IPO). The IPO by Oravel Stays - the parent company of OYO Hotels & Homes - will comprise fresh issuance of shares worth Rs 7,000 crore and an offer for sale of shares worth Rs 1,430 crore.
Softbank Vision Fund, which has been named as a promoter in the filing, will sell the majority in the OFS, selling up to Rs 1,328 crore, while Grab's A1 Holdings Inc will sell Rs 51.6 crore worth of shares, and HEro Enterprise's Global Ivy Ventures will sell a little over Rs 2 crore worth of shares. The other selling shareholder is China Lodging Holdings, which will sell up to Rs 23 crore worth of shares.
The company said it may also consider a pre-IPO placement of Rs 1,400 crore.
Oyo is eyeing a valuation of between $10-$12 billion, as per sources. The company was valued at a little under $10 billion after it raised funding from Microsoft recently.
The company says it will use the net proceeds partly (Rs 2,440 crore) to make repayments on borrowings by the group, while Rs 2,900 crore will be used towards organic and inorganic growth initiatives.
Oyo saw a major impact from the Covid-19 pandemic on revenues, with the total income of the company dropping by nearly 70% in Fy21 to Rs 4,157 crore. However, the company also pared losses significantly to Rs 3,943 crore from Rs 13,122 crore in Fy20.