Ola in talks with Naspers, Temasek to raise fresh funds
South African internet conglomerate Naspers is in talks with ANI Technologies Pvt. Ltd to invest in ride hailing app Ola at a valuation of $7-8 billion, said three people familiar with the development.
Besides Naspers, Ola is also speaking with Temasek and two other funds to raise $1 billion in fresh capital, the people cited above said, requesting anonymity. Ola, which is currently valued at about $4 billion, may see its valuation double after the proposed funding round, they said, adding that the talks haven’t reached the final stages.
Last October, Ola had raised $1.1 billion from SoftBank Group and Tencent, among others. It had announced back then that it would raise $1 billion more.
However, the company’s proposed fund raise has faced hurdles over concerns related to a boardroom battle between Ola chief executive Bhavish Aggarwal and SoftBank and Tiger Global, the people cited above said. Aggarwal had blocked a proposed sale of shares by Tiger Global to SoftBank late last year in order to stop the Japanese investor from raising its stake.
Potential investors are wary of backing a company that has had differences with SoftBank, the most powerful investor in the tech world, the people added.
Temasek’s discussions with Ola was reported by Mint and other publications. The Singaporean investor is already in the process of becoming a share-
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holder in Ola through a secondary deal worth over $200 million. Once that deal is completed, Temasek will invest primary capital in Ola at a much higher valuation, the people mentioned above said.
“Temasek has decided to complete the secondary share purchase first, before finalizing the terms of the primary investment. Usually both primary and secondary transactions happen simultaneously, but in this case, they want to negotiate the primary transaction at a higher valuation only after existing shareholders have sold their stakes in the secondary deal,” said one of the people cited above. Ola and Naspers did not respond to a request for comment.
The latest funding talks come at a time when Ola is attempting to shore up its core cab-hailing business in India against Uber Technologies. As part of its plans, it is looking to aggressively expand its footprint abroad and within India, besides build a strong food-tech business to compete with Swiggy and Zomato.