(IANS) Satya Nadella-run Microsoft has invested $5 million in Airbnb-backed Indian budget hotel chain OYO taking it valuation to $9 billion, as the hospitality chain plans a potential initial public offering (IPO) soon.
According to a regulatory filing by OYO this week, Microsoft Corporation has invested $5 million (nearly Rs 37 crore) in the company via the issuance of equity shares and compulsory convertible cumulative preference shares (CCCPS).
OYO was valued at just $3 billion in recent quarters by SoftBank, one of its largest investors.
Reliable sources had told IANS last month that a deal may close soon once the due regulatory processes are met. The size of the deal could not be ascertained at that time.
The Ritesh Agarwal-run hospitality chain has Airbnb, Chinese ride-hailing giant Didi Chuxing and ride-hailing firm Grab as strategic investors.
Founder and CEO Agarwal said in July that the company would consider a potential IPO soon.
The news about the Microsoft-OYO deal surfaced after OYO announced earlier this month that it has raised $660 million from global institutional investors as TLB (Term Loan B).
A company statement had said that the offer was oversubscribed by 1.7 times and the company received commitments of close to $1 billion from leading institutional investors.
The company said it will utilise these funds to retire its past debts, strengthen the balance sheet and other business purposes including investment in product technology, it said.
OYO is the first Indian startup to be publicly rated by Moody’s and Fitch, two of the leading international rating agencies.
The Microsoft deal “may also involve OYO shifting to use its cloud services”, a TechCrunch report mentioned.
OYO has aggressively been expanding its operations to several markets including Southeast Asia, Europe, and the US in recent years.