Microsoft is in advanced talks to pick up a stake in hotel chain Oyo at a valuation of about $9 billion (around ₹67,000 crore), reports have said. Reuters reported that the deal could be announced in the coming weeks ahead of an initial public offering (IPO) planned by Oyo. Ritesh Agarwal, Oyo’s founder and chief executive officer, said earlier this month that his company would consider a potential public offering without giving a timeline.
TechCrunch was the first to report about the deal between Microsoft and Oyo and said on Thursday that the proposed deal may involve Oyo shifting to use Microsoft’s cloud services.
Oyo raised a term loan B (TLB) funding of $660 million (nearly ₹4,920 crore) from global institutional investors and it will use the capital to pay off debt and for other business investments. Oyo said in a statement that the offer was oversubscribed by 1.7 times and the company received commitments of close to $1 billion from leading institutional investors, OYO had said in a statement.
SoftBank Group Corp, which owns a 46 per cent stake, Sequoia Capital, Lightspeed Ventures and Hero Enterprise, among others, back the budget hotel chain Oyo.
Oyo’s Ritesh Agarwal said earlier this year the company “is on a steady path of a resurgence in 2021” and that it is seeing signs of recovery across India, Europe, and Southeast Asia.
(With agency inputs)