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Oyo Rooms likely to acquire rival Zo Rooms

  • Budget hotel site Oyo
    Rooms has expressed interest in buying smaller rival Zo Rooms, which is
    scrambling to raise a fresh round of funds in order to avoid being sold, the
    Mint reported, citing people in know of
    the development.
  •  
  • The overture from Oyo
    • Budget hotel site Oyo
      Rooms has expressed interest in buying smaller rival Zo Rooms, which is
      scrambling to raise a fresh round of funds in order to avoid being sold, the
      Mint reported, citing people in know of
      the development.
    •  
    • The overture from Oyo
      Rooms follows the entry of large online travel firms MakeMyTrip, Yatra Online
      and Goibibo into the budget hotel segment.
    •  
    • Though Zo Rooms is
      currently in conversations with at least two investors for a fresh funding
      round, it faces an uphill task as its biggest investor, Tiger Global Management,
      has decided to go slow on writing large cheques for the smaller companies in
      its portfolio, the people cited above said in the report.
    •  
    • “Zo has held talks
      with several new investors though a deal is not near any closure,” one of the source
      said.
    •  
    • The company, which is
      under pressure to cut costs, may shut its operations in Goa,
      the source said.
    •  
    • Zo has raised roughly
      $35 million from Tiger and Orios Management this year.
    •  
    • Oyo approached Zo
      last month with a buyout offer to widen its lead in the budget hotels space, according
      to the
      Mint report.

     

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