Microsoft in talks to support pandemic-stricken Oyo hotel chain
Microsoft is in late-stage talks to invest in Indian budget hotel chain Oyo, according to reports, after 18 months of bruising for the company.
The support would value the startup at around $ 9 billion, sources said, although the investment figure is not yet known.
The deal could be reached as early as Friday, a source said. Support from the tech giant could also see Oyo transitioning to Microsoft’s cloud services.
It comes just two weeks after receiving $ 660 million in debt financing from global institutional investors.
Oyo’s valuation reached $ 10 billion in 2019, after its founder Ritesh Agarwal bought $ 2 billion in shares from venture capital firms.
However, its valuation suffered a slump after major investor SoftBank reduced it to $ 3 billion.
The budget hotel chain was hit hard by the pandemic and the tight travel restrictions that quickly followed.
Oyo’s growth had previously been held back by poor relationships with hotel owners, but pledged to strengthen them last year.
Soon after, however, the pandemic struck – leading the hotel chain to lay off thousands of employees around the world as business slowed dramatically.
If the deal goes through, it will be Microsoft’s latest investment in an Indian startup after e-commerce giant Flipkart, which posted a valuation of $ 37 billion earlier this month.