OYO will have 75% principal component and 25% secondary component in its IPO offering

OYO is likely to issue new shares valued at $ 700-800 million as part of its IPO offering

He is likely to file his DRHP in the next 10 days with SEBI, inform sources Inc42

Hospitality unicorn seeks $ 12 billion to $ 14 billion valuation

The hotel unicorn linked to the OYO IPO, which will file its draft red herring prospectus (DRHP) with the market regulator SEBI in the next 10 days, is expected to have around 75% primary component and the 25% remaining as a secondary component of its offer.

According to sources, OYO’s IPO offer will include new issues of shares between 70% and 80% of the offering, and the remainder will consist of secondary issues, meaning shareholders of the company will sell part of their shares.

OYO is expected to opt for an IPO of between $ 1 billion and $ 1.2 billion. Based on the calculations, the hospitality unicorn is likely to issue new shares worth $ 700-800 million and the rest, which is expected to be around $ 200 million, will be offered to the sale. The startup is considering a valuation of 12 to 14 billion dollars and has been shortlisted investment banks such as JP Morgan, Kotak Mahindra Capital and Citi to manage its IPO.

According to an ET report, OYO founder Ritesh Aggarwal, who owns around 30% of the capital of the hospitality unicorn, is not expected to divest shares during the planned IPO. Currently, SoftBank owns 46% of the company’s shares, Agarwal owns 34%, around 7% of the shares are owned by employees, and the remaining shares are held by other investors, Inc42 reported earlier.

Founded by Agarwal in 2013, the startup is backed by renowned investors such as Masayoshi Son’s SoftBank, Airbnb, Lightspeed Venture Partners, Innoven Capital, Hero Enterprises, among others.

OYO last raised $ 5 million from US tech giant Microsoft in exchange for 5 shares and 80 preferred shares at a valuation of $ 9 billion. Earlier in July, the startup closed $ 660 million in term loan financing from global institutional investors. The Gurugram-based company said the offer was 1.7 times oversubscribed and the company had pledges of nearly $ 1 billion from institutional investors.

In the hotel space, OYO follows the example of the startup based in Gurugram ixigo, which has filed its HRD and is heading for an IPO of INR 1,600 Cr. Earlier this year, another online travel portal EaseMyTrip has opted for an INR 510 Cr IPO and only recently went through a $ 1 billion in market capitalization.

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