The SoftBank Group Corp.-backed hotelier is expected to win approval from the Securities & Exchange Commission, with the offering available this week or next. SoftBank owns 47% of the company.
Despite rocky times due to COVID-19 related travel restrictions, Oyo prepared to file for an initial public offering (IPO) to raise roughly $1 billion last fall.
The offering was expected to consist of a fresh issue of shares and an offer for sale from current shareholders, the source said. Oyo did not immediately respond to requests for comment from PYMNTS.
Read more: Indian Hotel Startup Oyo Prepping IPO
Founded in 2015, the company’s business model thrived at first but hit a snag due to COVID-19 travel restrictions in 2020. That year, SoftBank stepped in and laid off staff, while also taking back $75 million that had been meant for Oyo’s growth in Latin America. Oyo also downsized its operations in Japan around the same time.
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In 2021, Oyo laid off nearly all staff in Latin America and reduced funding as it shifted to a digital-only model in that region. At the time, Oyo said it was pivoting to areas that were more promising, including India, Southeast Asia and Europe.
The report said executives are keeping an eye on IPO demand as Oyo prepares to build an order book from institutional investors. The decline in tech stocks in the U.S. could also have an impact on valuations, a source said.
In Oyo’s initial filing, the company said it planned to raise 84.3 billion rupees ($1.1 billion) with the sale of new and secondary shares as well as those held by existing investors, the report noted.
