July 19, 2019 / 8:51 AM / 4 months ago

Oyo founder to buy back $2 billion worth stake in SoftBank-backed Indian co

FILE PHOTO: The logo of OYO, India's largest and fastest-growing hotel chain, installed on a hotel building is pictured in an alley in New Delhi, India, April 3, 2019. REUTERS/Adnan Abidi/File Photo

BENGALURU (Reuters) - Indian hospitality startup Oyo Founder Ritesh Agarwal raised his stake in the company with a $2 billion buyback, in a move that will bring his ownership closer to biggest investor SoftBank Corp (9434.T).

The fresh investment round will take Agarwal’s stake to around 30% from 10%, a source familiar with the development said.

Japan’s SoftBank owns around 45% in the company.

As part of these transactions, current investors Lightspeed Venture Partners and Sequoia India are selling portions of their holdings in OYO to help Founder and CEO Agarwal increase his stake, Oyo said in a statement.

Agarwal will fund the buyback through institutional lenders and financial partners, the source said, adding that the round took the company’s valuation to $10 billion.

Oyo did not give details on how Agarwal will fund the deal or on his stakeholding.

Reporting by Derek Francis in Bengaluru; Editing by Subhranshu Sahu

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