Grab books $100 million Oyo to drive into Southeast Asia

NEW DELHI: Singapore ride-hailing company Grab has invested about $100 million in Oyo Hotels & Homes, the Gurgaon-based hospitality chain said in a filing with the Registrar of Companies on Thursday.

A1 Holdings Inc, a Cayman Islands-registered entity controlled by Grab, has been issued 2,884 cumulative convertible preference shares at a price of $34,670 each, as part of the SoftBank Vision Fund-backed Oyo’s Series E equity financing round, according to the RoC filing, which was accessed by data research platform Tofler.

As per calculations, Grab has invested Rs 732.73 crore in hotel aggregator Oyo. The investment, first reported by ET in its December 3 edition, is part of Ritesh Agarwal-led Oyo’s ongoing $1-billion funding round.


With the latest investment said to have been made two weeks ago, Oyo has raised $900 million in this round till date.

China a Core Market
The final tranche of $100 million of the overall $1 billion in funding is expected to come in by the end of 2018.

The investment by Grab into Oyo, both of which count SoftBank as one of their primary investors, comes when the companies have identified southeast Asia, particularly Indonesia, as a key market.

Grab has been going headto-head with Indonesia’s Go-Jek and has clearly stated its intention of entering sectors ranging from grocery delivery to healthcare in the country, which has emerged as a favoured destination of some of the world’s largest technology companies, according to a report by Bloomberg.

In October, Oyo announced the launch of operations in Indonesia with 30 full-inventory franchised and operated exclusive hotels and over 1,000 rooms in three cities — Jakarta, Surabaya, and Palembang. It had also stated plans of investing $100 million in the country and its intention of launching in over 35 cities by 2019.

Oyo has earmarked $600 million of the current funding round for operations in China, a country it now counts as a core market alongside India, with the rest directed towards overall hiring and other markets such as southeast Asia and the UK.

In an interview with ET last month, Agarwal, chief executive of Oyo, said the six-year-old company manages 180,000 rooms across 4,000 leased and franchised properties in China, making it its largest market about a year after formally launching operations.

In September, SoftBank Vision Fund, the world’s largest private technology investor, led an $800-million funding round in Oyo, in the process vaulting it into the Unicorn club of startups valued at over $1 billion.

The company’s aggressive international expansion plans have made it the first Indian consumer-facing startup to look outside its core domestic market.