Oyo raises $5 mn from Microsoft at $9.6 bn valuation

Global travel technology company Oyo has raised $5 million from Microsoft in a strategic round at a valuation of $9.6 billion, according to a regulatory filing by the hospitality firm.

An extraordinary general meeting (EGM) of Oravel Stays Pvt Ltd (Oyo), which runs the Oyo Rooms chain of hotels, on July 16 approved the issue of equity shares and compulsory convertible cumulative preference shares (Series F2 CCCPS) amounting to rupee equivalent of $5 million to Microsoft in a private placement, according to a filing with the Registrar of Companies (ROC) by Oyo.

Under the deal with Microsoft, Oyo will issue five equity shares of the face value of ~10 each for cash at an issue price of India rupee equivalent of $58,490 per equity share. The firm is aiming to transform itself to a global full-stack technology provider for small- and mid-sized hotels and homes.

Oyo has said it is going to hire over 300 technology professionals over the next six months in profiles, including software development, engineering and product managers, designers, and data scientists across entry-level to senior leadership roles. The firm said it will hire full-stack teams with skill sets and expertise in machine learning, data engineering and information security, Android, and IOS developers.

The expanded design, product and engineering teams will be responsible for building long-term capabilities for Oyo and update the current tech capabilities. The firm is set to introduce innovations and commit to investments in technology, optimising revenues for hotel owners, while improving user experience for customers.