OYO seeking up to $1.2 billion in IPO

This comes on the heels of the company’s tech partnership with Microsoft

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OYO is planning to raise up to $1.2 billion through an IPO it is filing this week. OYO founder Ritesh Agarwal, pictured, said in March that the company is on “a steady path of resurgence” this year.

HOSPITALITY FIRM OYO is planning to raise up to $1.2 billion through an IPO and is expected to file the draft red herring prospectus with market regulator SEBI this week, sources said on Thursday. OYO has appointed investment banks like JPMorgan, Citi and Kotak Mahindra Capital to manage its public issue, they added. Comments from OYO could not be obtained.

The proposed IPO plan of the hospitality firm follows the spectacular success of Zomato’s IPO that ended with a bumper oversubscription on July 16 and was the biggest since March 2020.

Last week, shareholders of Oravel Stays, the parent company of hospitality firm, had approved the conversion of OYO from a private limited company to a public limited company, according to a regulatory filing.

In a Registrar of Companies filing in August, OYO had said Microsoft Corp. has invested nearly $5 million in OYO through the issuance of equity shares and compulsory convertible cumulative preference shares on a private placement basis. The two companies also are collaborating on the development of “smart room” technology for hotels.

Earlier in July, the company had raised $660 million through the term B loan route from global institutional investors, including Fidelity Investments to refinance and simplify its existing borrowings.

“OYO is on a steady path of resurgence in 2021 and is seeing signs of recovery across India, Europe, and Southeast Asia,” OYO founder and Group CEO Ritesh Agarwal said in March.  “OYO’s survival through the Covid crisis and our resurgence show that we are a company with strong fundamentals and high-value potential.”

This story originally appeared in Asian Hospitality’s sister publication, Eastern Eye, and has been edited for style.