Travel portal MakeMyTrip (MMT) is reportedly looking to raise $330 Mn from South African Internet and media conglomerate Naspers and Ctrip as well as other investors. The investment will be raised via share sale as per recent SEC filings of the company.
Yesterday, the company announced that it has entered into definitive share purchase agreements for the placement of its ordinary shares to investors. Under the terms of the agreement, the company will issue 4,583,334 ordinary shares in the aggregate to investors at a price of $36 per ordinary share.
Apart from this, the company has also entered into a share purchase agreement with Ctrip and MIH Internet SEA Pte. Ltd, a subsidiary of Naspers. Ctrip.com International Ltd., who had purchased 5-year convertible notes issued by MMT for $180 Mn in 2016.
A company statement said, “MakeMyTrip separately entered into share purchase agreements with (i) Ctrip.com International, Ltd. (“Ctrip”) for the issuance of its ordinary shares to Ctrip and (ii) MIH Internet SEA Pte. Ltd., a subsidiary of Naspers Limited (“MIH”), for issuance of the Company’s Class B convertible ordinary shares to MIH, which transactions will generate an additional $165 Mn of gross proceeds to the Company. The foregoing transactions with the Investors, Ctrip and MIH are expected to general total gross proceeds of $330 Mn.”
Under the company’s share purchase agreement with Ctrip, MMT will issue 916,666 ordinary shares to Ctrip, at a price of $36 per ordinary share. On the other hand, it will issue 3,666,667 Class B Shares to MIH at a price of $36 per share. The Class B Shares issued to MIH will be convertible into ordinary shares of the company on a one-to-one basis.
The transaction is expected to close by the end of this week as per an official statement.
According to the same statement, “Proceeds from the transactions will be used to fund business expansion, strategic investments, technology and product development, marketing and promotions, working capital and general corporate purposes.”
Currently, as per another company statement, MakeMyTrip has access to over 40,000 hotels, 13,500 alternative accommodation properties in India and more than 240,000 hotels and properties outside India, Indian Railways and all major Indian bus operators.
In February 2017, it was reported that venture capital and private equity firm SAIF partners exited from its investment in travel portal MakeMyTrip with a 16X return at $400 Mn.
Last month, online budget hotel brand and booking platform RedDoorz raised $1 Mn venture debt from InnoVen Capital. This round was an extension of its Series A round, which it raised in 2016. In August 2016, Gurugram-based budget hotel aggregator OYO raised over $62 Mn (INR413 Cr) in a new round of funding led by existing investor – Japan’s SoftBank Group Corp. Other startups in this segment include Cleartrip.com, Yatra, Booking.com, Expedia, Wudstay Hotels, FabHotels, Treebo Hotels, etc.