Indian startup Oyo Hotels plans to sell only a third of new shares than originally planned at its upcoming IPO, sources informed Bloomberg.
Founder Ritesh Agarwal is reportedly pursuing the IPO to relieve financial pressure on the company, which is mounting losses. The company could file an IPO document as early as this week.
Due to the weak IPO market, the hotel and lodging booking startup may receive less favorable terms and valuation at the IPO listing.
- SoftBank had reduced Oyo's valuation internally to $2.7B, down from its peak valuation of $10B.
- Oyo previously filed for an IPO in early 2022 at a valuation of $9B but had to retract its filing after India's stock market regulator raised concerns.
- Agarwal is personally under pressure after he took a $2B loan from Japanese lenders to increase his stake in Oyo to 33% in 2019, when the firm was valued at $10B.
- SoftBank founder Masayoshi Son personally guaranteed the debt.
- Oyo's current backers will not be offering their shares at the upcoming listing.
