Indian hotel chain startup OYO’s China business has been seeking its first round of equity financing for some time.
Though the company’s executives said that fresh funds would be injected by early July, it still seems to be a long way from securing that cash, according to an unnamed source in OYO’s regional headquarters in Shanghai that is familiar with the deal and spoke to 36Kr.
Speaking separately, a former OYO China executive said that the possibility for bagging this investment was so low that it would make securing funds in the future even more difficult.
The former executive pointed out that investors may put in place certain requirements, like requiring OYO China to double the number of low-cost rooms on its listings from 500,000 to one million. Failing to do so might indicate a “systematic collapse” for OYO China, subjecting it to a final acquisition from an established player in the hospitality sector.
OYO China’s recent massive layoff, which affected more than 1,000 employees, also speaks to the company’s difficult times in the country.
Read Original Article