According to a recently circulated note to its shareholders, Oyo has informed that founder Ritesh Agarwal will invest $65.1Mn into his founded hospitality chain, at a $3.8Bn valuation. The investment will come in via an investment vehicle named Redspring Innovation Partners, and is backed by Agarwal.
The $3.8Bn valuation represents a noticeable 60% uptick from the $2.3Bn that the firm was last valued at, but is still over 60% below the peak $10Bn it had achieved in 2019. In fact, the present valuation that Agarwal has pegged his company at, is only slightly higher than the $3.4Bn in equity+debt that the company has raised so far from external investments.
During the last round in June, where Oyo was valued at $2.3Bn in a $175Mn round, investment was again led by Agarwal’s Redspring with a $100Mn infusion, with the rest of $75Mn coming in from a group of existing and new investors. Multiple media reports also suggest, that like its previous round Agarwal is looking for additional investors apart from his own investment, in this new round as well.
The new round is expected to increase Ritesh Agarwal’s shareholding in the company to 17.3%.
Oyo has off late improved its financials and overall business significantly. The company has also done major acquisitions globally, as it looks to expand presence in affordable hospitality segment. Most recent and perhaps its most notable acquisition of all, was the $525Mn deal to buy iconic US chain ‘Motel 6‘ from Blackstone. The transaction resulted in Oyo gaining nearly 1400 properties across the United States.
