- The transaction cost around $100 million
- OYO launched the site in Japan back in March by a joint venture deal with Yahoo Japan
- SoftBank and OYO launched the hotel joint venture in April to capitalize on Japan’s growing popularity as a tourist destination
An 80 percent stake in Japanese apartment rental operator MDI was acquired by India’s hospitality unicorn Oyo and its main backer SoftBank Group. According to one person familiar with the matter, the transaction cost around $100 million.
By a joint venture deal with Yahoo Japan, OYO launched the site in Japan back in March. It helps users to find, lease and leave apartment rooms through a mobile app and target millennials who prefer renting rather than buying properties.
SoftBank and OYO launched a hotel joint venture in April to capitalize on Japan’s growing popularity as a tourist destination.
An OYO spokesman said in an email that the company is looking to “leverage the strong network and business development capabilities of MDI in Japan’s real estate market.” According to the report, MDI recently posted revenues of approximately US$ 1 billion in the fiscal year ending March.
Nevertheless, OYO refused to comment on the price and specifics of their share in the joint acquisition, and both SoftBank and MDI declined to discuss the topic as well.
Real estate is a capital-intensive business. The involvement of SoftBank is a strong endorsement for OYO in Japan,” said the source.
Oyo plans to list part of the 37,000 rooms operating under MDI management on its rental brand Oyo Life in Japan, according to the survey. In its country stocks, it currently has more than 2,000 spaces.
The company’s objective, according to a spokesperson, is to’ leverage the strong network and business development capabilities of MDI in Japan’s real estate market.’ Once the deal is complete, OYO plans to add some of the MDI listings to the OYOLife room rental platform.
It already has a portfolio of around 2,000 rooms in Japan, which for the Indian hospitality giant is still a relatively new market. It now provides holiday rentals in dozens of countries, greatly helped by a $400 million deal since buying the Netherlands-based Leisure Group.
Recently OYO stretched its presence in the US as well:
The world’s third-largest and fastest-growing chain of hotels, homes, and living – OYO Hotels & Homes has expanded its presence to over 100 hotels in more than 21 states in the United States.
Recently, the firm partnered with Highgate Hospitality Investment and Management to open its first major flagship property OYO Hotel & Casino in Las Vegas, USA.
OYO Adding Values:
The SoftBank-backed company is successfully moving forward at an impressive rate, opening one or more buildings per day, creating more than 4,000 jobs. With 112 OYO hotels live in July in more than 21 states and 60 cities, including Dallas, Houston, Los Angeles, Seattle, Atlanta and Miami, Founder and CEO Ritesh Agarwal has added the hotel chain is set to drive growth across the US while delivering quality customer service.
Founder Ritesh Agarwal’s vision and plan to use artificial intelligence to streamline hotel management attracted Son, whose Vision Fund led OYO‘s $1 billion funding round in 2018. Agarwal acquired new and existing shares in the company worth $2 billion in July, backed by international banks and financial partners.
Owned by Oravel Stays Private Limited and based in Gurgaon, Haryana, India, the company has 450,000 listings in 500 cities in India, China, Malaysia, Nepal, Sri Lanka, United Kingdom, United States, United Arab Emirates, Saudi Arabia, Philippines, Indonesia, Vietnam, and Japan.