Oyo Rooms, India’s largest budget hotel chain, is reported to be on the verge of closing a new funding round worth around $250 million. The funding is coming from its existing investor SoftBank, at a valuation of $850 million.

A report suggests that while SoftBank was ready to give $500 million to the Ritesh Agarwal-led startup, other investors of the company opposed the move. It is not yet clear if other existing investors of the company are participating in this round or not.

The news about the fresh funding round is in line with our previous report where we mentioned that the company was looking to raise around $300 million to $500 million from SoftBank.

SoftBank is investing in Oyo Rooms from its $100 billion SoftBank Vision Fund. With the closure of this funding round, SoftBank will become the majority shareholder of the company with over 42 percent stake. Currently, it holds around 27 percent stake in the company.

The new valuation of around $850 million is a significant increase from its earlier valuation. Oyo was valued at $460 million when it last raised about $62 million capital in August 2016.

Till now, SoftBank has invested around $120 million in the company across two funding rounds in the year 2015 and 2016. OYO was founded in 2014 by Ritesh Agarwal, a college drop-out and geek, who plunged into entrepreneurship at the age of 17. The company’s vision is to standardize and build efficiency into all forms of real estate such as budget hotels, apartments, guest houses and resorts.

The funding will help Oyo to further expand its network of 7,000 hotels and 70,000 rooms in 200 Indian cities. A key component of the expansion plans will now be its new initiative called Townhouse, which targets the mid-premium segment as compared to budget consumers.

Oyo is taking properties on lease to control customer experience via Townhouse Properties, four of which are already operational in Delhi and Gurgaon area. The hotel aggregator is planning to introduce 200-250 Townhouse properties across the country by the end of this year.

The new funding round will also give a much-needed boost to the company’s plans for international expansion. Oyo Rooms has also started international expansion, beginning with Malaysia, and will now lead its brand name to other geographies.

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