Oravel Stays Pvt Ltd (Oyo) approved on July 16 the issue of equity shares and convertible cumulative preference shares amounting to rupee equivalent of $5 million to Microsoft in a private placement, according to a filing by Oyo with the Registrar of Companies.

Last month, a source familiar with the matter had told Reuters that Microsoft was in advanced talks to invest in Oyo at a $9 billion valuation.

The hotel aggregator, in which Japanese conglomerate SoftBank owns a 46 percent stake, endured months of layoffs, cost cuts and losses during the Covid-19 pandemic.

But with easing travel curbs and increasing vaccinations, travel demand is slowly recovering in India, with local tourism attractions witnessing a higher traffic.

In early July, Oyo’s founder and chief executive officer, Ritesh Agarwal, said the firm would consider a potential public offering, but did not provide a timeline.

India is currently witnessing an IPO frenzy. In July, food-delivery firm Zomato saw a stellar debut. Berkshire Hathaway Inc-backed Paytm and ride-hailing firm Ola, which is also backed by SoftBank, are among other Indian startups looking to enter markets.

Last week, a financial news website reported that Oyo had shortlisted JP Morgan, Kotak Mahindra Capital and Citi for a more than $1.2 billion initial share sale. Oyo did not respond to a request for comment on the report.

(Reporting by Chandini Monnappa and Vishwadha Chander in Bengaluru; Editing by Saumyadeb Chakrabarty and Subhranshu Sahu)

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