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    Home News Business OYO, SoftBank's joint venture secures ₹50 crore in debt

    OYO, SoftBank’s joint venture secures ₹50 crore in debt

    The debt financing provided by Avendus Finance is the first entry by an external investor in an Oyo-owned venture.

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    Graduated from Mumbai University, Ajay brings in the latest news across sports, tech, and world news. Ajay loves talking on tech, latest news, and events.

    Oyo Hotels & Homes has raised Rs 50 crore in debt financing for MyPreferred Transformation — its joint venture with its largest shareholder SoftBank — from non-banking finance company Avendus Finance.

    Oyo and SB Topaz, an entity controlled by SoftBank, formed the joint venture in late 2018 to carry out renovation and refurbishment of Oyo’s hotels and other similar assets in India and other South Asian markets.

    Set up in 2016, Avendus Finance, the credit solutions arm of home-grown financial services firm Avendus Capital, provides services such as promoter financing, growth funding, and corporate financing solutions.

    The debt financing provided by Avendus Finance is the first entry by an external investor in an Oyo-owned venture, given that the hospitality chain has largely been raising equity funds from its existing set of investors.

    In a statement, Oyo said the joint venture would use the debt raised from Avendus Finance to “strengthen its focus on upgrading and designing quality living spaces for hotel assets in India.”

    “We thank Avendus Finance for their confidence in the fundamentals of the business and the untapped hospitality potential of the Indian market. This infusion will help us continue to scale our ambitions of developing and upgrading quality living spaces for hotels and similar assets, so there is an Oyo for every pocket,” Meenakshi Rajpal Mehta, vice president, Financial Services, Oyo, said.

    According to the latest data shared by Oyo, it currently operates more than 18,000 hotels and 2,70,000-plus rooms across India and South Asia.

    Oyo also has a second joint venture with SB Topaz, Mountainia Developers & Hospitality, which has been set up to acquire hotels-related real estate assets, ranging from land to fully developed properties, and which was first reported by ET on September 25.

    Since September last year, Oyo has raised an estimated $1.3 billion in primary capital, according to business intelligence platform Crunchbase, and is currently in the process of raising an additional $1.5 billion in its Series F financing round.

    Earlier this week, ET reported that the board of Oravel Stays, which owns and operates Oyo Hotels & Homes, had cleared the $1.5 billion primary capital infusion by SoftBank Vision Fund and founder Ritesh Agarwal’s RA Hospitality.

    RA Hospitality, a Cayman Islands-domiciled special purpose vehicle which is being used by Agarwal to invest primary capital into the company he founded in 2012, as well as to undertake secondary transactions, has invested about $693 million as part of the latest round of financing.

    SoftBank, through its Vision Fund, has invested about $810 million into the company in the latest financing round. Other investors, new and existing, may also participate in the ongoing round.

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