OYO Hotels & Homes founder and chief executive Ritesh Agarwal on Friday said he will deploy $2 billion (Rs 13,763 crore at current exchange rate) to boost his stake in the hospitality platform via buyback of shares and purchase of fresh equity.
Agarwal will transact through RA Hospitality Holdings (Cayman), a statement by OYO said.
As part of the programme, early investors Lightspeed Venture Partners and Sequoia Capital India will sell part of their shareholdings in OYO, owned by Oravel Stays Pvt. Ltd, the statement said. The deal will be subject to shareholder and regulatory approvals.
The investment will see Agarwal’s stake in the company rise to approximately 30% from the current 10% -- a move that will bring his holding closer to biggest investor SoftBank Corp, according to a Reuters report. Agarwal and largest minority investors Lightspeed Venture Partners and Sequoia Capital India had put in a clause that Japan’s SoftBank cannot raise its shareholding beyond 50% without their approvals, The Times of India had reported earlier this month, citing filings. SoftBank currently holds 46% stake.
OYO, which began operations in 2013, says it currently manages over one million rooms and has partnered over 300,000 urban and vacation homes across the world.
The company announced a $1 billion round of fundraising in September last year, which it completed in February after receiving $100 million from Chinese ride-hailing company Didi Chuxing.
SoftBank, Singaporean ride-hailing company Grab, Lightspeed Venture Partners, Sequoia Capital and Greenoaks Capital had contributed the initial $900 million to the round, which valued OYO at $5 billion. This was followed by Airbnb's investment in OYO in April.