Singapore firm may grab $100-million ride to Oyo

Singapore ride-hailing company Grab is in advanced discussions to invest $100 million (Rs 697.7 crore) in Oyo Hotels & Homes as part of the Indian hospitality chain’s ongoing $1-billion funding round.

Grab, which acquired rival Uber’s south-east Asian business in March, is expected to close the deal over the next few days, according to two people briefed on the matter.

Grab and Oyo, both of which count SoftBank as one of their primary investors, have identified Indonesia as a key market. Grab, which has been going head-to-head with Indonesia’s ride-hailing and logistics startup Go-Jek, has stated its intention of entering sectors ranging from grocery delivery to healthcare, according to a report by Bloomberg.

Oyo announced the launch of its Indonesia operations in October last year.

At the time, the Ritesh Agarwal led company started with 30 full-inventory franchised and operated exclusive hotels and over 1,000 rooms in Jakarta, Surabaya and Palembang. It also stated plans of investing $100 million in Indonesia and will look to launch in over 35 cities by 2019. “Indonesia is one of the top choices for both global and Indian travellers and with our market learnings and expertise, we are ready to tap this opportunity,” Agarwal had said at the time.

Emails sent to Oyo spokespersons did not elicit any response at the time of going to press. “As a matter of company policy, we do not comment on market rumours and speculation,” a Grab spokesperson told ET.

The proposed investment will be made through A1 Holdings Inc., an entity controlled by Grab, which was valued at $11 billion at the close of its funding round in August, the two people said.

Grab, which has raised $2 billion in 2018 alone and plans to seek an additional $1 billion, according to reports, already has an existing venture investment arm, Grab Ventures, which has made four investments so far, according to its website.

The latest investment is part of Oyo’s $1 billion funding round, which was first reported by ET in its August 16 edition. After the anticipated closure of the transaction, Gurgaon-based Oyo would have raised $900 million in equity financing, with the final tranche of $100 million expected by the end of the year.

Grab’s planned investment in Oyo would be at the same valuation — $5 billion — that the hospitality chain commanded in September, when an investor consortium led by SoftBank Vision Fund pumped in $800 million and vaulted it into the Unicorn club — startups worth $1 billion and more.

Oyo has earmarked $600 million of the latest funding for operations in China, a country it counts as a core market alongside India, with the rest directed towards hiring and other overseas markets such as south-east Asia and the UK.

Source:-https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/singapore-firm-may-grab-100-million-ride-to-oyo/articleshow/66913990.cms

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