OYO Denies Talks To Acquire Keys Hotels In India

Homegrown OYO Hotels and Homes has said that it is not in talks with Los Angeles-based venture capital firm Berggruen Holdings to acquire their company Keys Hotels in India as was earlier reported.

According to ET report, citing unnamed sources, Keys Hotels has been scouting for buyers and has an estimated debt of about INR 160 Cr ($22.4 Mn).

Responding to Inc42‘s queries on the matter an OYO spokesperson said that “This is baseless speculation”

“Our acquisition strategy is targeted towards acquiring entities that assist us in building capabilities. We, therefore, look at selective but strategic investments that help build capabilities rather than just scale. We do not have any further announcements to make at the moment,” the spokesperson said.

Last year in October, Keys Hotels celebrated its 12 anniversary in India. It currently has 21 properties in more than 19 locations in India across cities such as Mumbai, Chennai, Mahabaleshwar, and offers three brands — Keys Prima Hotels, Select Hotels, and Lite Hotels.

In November last year, it hired Manoj MV as Keys Hotel South India director of sales, Arindam Banerjee as human resources general manager, and Muheeb Ahmed as the Bengaluru cluster sales director. Over the past two to three years, the company has time and again witnessed a spate of senior-level exits.

SoftBank-backed, OYO is bullish on its expansion plan in both within the country and across eight international countries — China, Malaysia, Nepal, UK, UAE, Indonesia, Philippines and the US.

Speculations are also rife that OYO is planning on acquiring coworking space provider Innov8 for about INR 200 Cr. In March 2018, Oyo acquired Chennai-based serviced apartments company Novascotia Boutique Homes, which runs over 45 SilverKey properties in nine cities.

“Recently we joined forces with Weddingz.in to offer customers a one-stop platform for all their needs related to organising a wedding, including beautiful and spacious venues, decorations, catering and a dedicated wedding planner. Back in March 2018, the acquisition of Novascotia Boutique Homes was our foray into the serviced apartment category which was later christened as SilverKey,” the spokesperson said.

The company operates as a full-stack fulfilment-led model where it fully acquires hotels and homes on franchise or leases and renovates. It then deploys technology for seamless management of the property including revenue, pricing, customer experience.

While the company witnessed 4.3x Y-o-Y (year-on-year) global sales growth with a realised value run rate of $1.8 Bn as of December 2018, it reported a 3.5x jump in revenue from its India operations for the year ended March 2018, with its operating revenue rose to INR 416 Cr (58.1 Mn) in FY 2017-18 compared 120 Cr ($16.7 Mn) in FY 2016-17.

OYO currently has 458K rooms across more than 500 cities in eight countries, including India. The company claims that it is all set to surpass its incumbents by adding more rooms to its platform than the world’s top three hotel chains combined.