OYO reportedly negotiating new funding round at $3 billion valuation
What's the story
Indian budget-hotel chain start-up, OYO, is in discussions for a funding round, that could decrease its valuation to $3 billion or less, as per TechCrunch.
Malaysia's sovereign wealth fund Khazanah is reportedly among the potential investors for this round.
The proposed terms could significantly reduce OYO's valuation from its 2019 peak of $10 billion.
However, these terms are still under negotiation and may change.
Denial
OYO refutes claims of decreased valuation
OYO, however, has refuted claims of a decreased valuation and insisted there is no "concrete transaction" in progress.
The company stated there was "no rational basis" for the internal reduction of its valuation to $2.7 billion by SoftBank, which holds more than 40% of OYO.
A company spokesperson denied any rumors about the devaluation, emphasizing that OYO continues to focus on performance and earnings.
IPO withdrawal
OYO withdraws IPO application amid funding discussions
The funding discussions follow OYO's decision to withdraw its draft red herring prospectus for an initial public offering (IPO) for the second time.
The company had initially filed paperwork for an IPO in 2021 with hopes of raising around $1.2 billion at a $12 billion valuation.
However, Indian market regulator SEBI, has not approved the start-up's application for an IPO.
Forecast
Revenue growth expected despite funding uncertainties
Despite the ongoing funding discussions and IPO withdrawal, OYO's founder and CEO, Ritesh Agarwal, has informed workers that the company expects its revenue for the fiscal year ending in March, to exceed $682 million.