India’s Oyo Offers Generous Terms for $600 Million Loan
- Hotel startup seeks to borrow at interest rate topping 8.5%
- India’s fresh virus surge has quashed hopes for travel rebound
Oyo is one of the largest startups in Softbank Group Corp.’s portfolio and its headlong global expansion was backed and fostered by the investor’s billionaire founder, Masayoshi Son.
Photographer: Dhiraj Singh/BloombergOyo Hotels, one of India’s most valuable startups, is offering unusually generous terms to investors as it seeks to raise $600 million in debt, following a fresh surge of coronavirus cases in its home country that decimated travel and undercut its recovery plans.
Oravel Stays Pvt, as the parent company is officially known, is discussing with banks and investors a five-year term loan B at 850 basis points over Libor, higher than the usual guidance given for recently issued term loan Bs in the Asia-Pacific market, according to Bloomberg-compiled data. The interest rate is similar to the 875 basis points over the BBSY benchmark paid by Mission Group BidCo Pty Ltd on a seven-year term loan B signed in June 2020.