Microsoft in talks to buy stake in OYO, sources say

NEW DELHI: Microsoft is in the advanced stages of discussions to pick up a stake in OYO that would value the hospitality firm at about USD 9 billion (around Rs 67,000 crore), according to sources.

While the deal size is not known, sources close to the development said it will not be a significant stake.

The transaction is likely to be completed before the proposed initial public offering (IPO) planned by OYO, for which no definitive timeline has been given.

OYO and Microsoft did not respond to queries seeking comments on the matter.

Earlier this month, OYO had raised a term loan B (TLB) funding of USD 660 million (nearly Rs 4,920 crore) from global institutional investors.

The capital will be used for paring debt and other business investments.

The offer was oversubscribed by 1.7 times and the company received commitments of close to USD 1 billion from leading institutional investors, OYO had said in a statement.

TLB refers to a tranche of senior secured syndicated credit facility from global institutional investors.

OYO is backed by marquee investors like SoftBank Vision Fund, Sequoia Capital, Lightspeed Ventures and Hero Enterprise, among others.

Earlier this year, OYO Founder and Group CEO Ritesh Agarwal had said the company "is on a steady path of resurgence in 2021" and is seeing signs of recovery across India, Europe, and Southeast Asia.

OYO's survival through the COVID crisis and resurgence shows that it is a company with strong fundamentals and high value potential, he had stated.