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OYO strengthens acquisition plans as it sets up joint ventures with SoftBank

09/27/2019| 9:26:23 AM| 中文

OYO Hotels and Homes has been increasingly investing heavily towards creating its own real estate business.

In the pursuit of a similar long-term strategy, OYO parent entity, Oravel Stays has set up multiple entities. According to the Ministry of Corporate Affairs filings accessed by Inc42, Oravel Stays has set up two new joint ventures with its largest investor SoftBank controlled SB Topaz, Mountainia Developers and Hospitality Pvt Ltd, and MyPreferred Transformation and Hospitality Pvt Ltd.

The development comes after reports surfaced that OYO has been contemplating setting up a global hospitality property fund that will acquire properties across markets and lease those to OYO at an agreed-upon yield.

This may not be seen as the wisest move in the industry, especially right now when SoftBank’s largest investment, The We Company i.e. WeWork is facing investor questions on its business model. As WeWork filed draft papers to go public, the company came under the fire of investors with the complicated maze of acquisition of its properties by CEO Adam Neumann and various other transactions between company and founders.

OYO has been another success story of SoftBank, and is diligently working towards being profitable. However, with multiple entities being set up for real estate transactions, once bitten, twice shy won’t be a surprising reaction from the industry.

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TAGS: OYO | softbank
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