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SoftBank-backed Ola in talks with investors to raise $500 mn to double its valuation

Taxi-hailing app
service Ola is reportedly all set to raise around $500 million from
investors.
The deal might add to the valuation of the company, reports the Economic
Times
, citing sources.

Taxi-hailing app
service Ola is reportedly all set to raise around $500 million from
investors.
The deal might add to the valuation of the company, reports the Economic
Times
, citing sources.

The current
valuation of Ola is $2.5 billion which might go up to $4.5 billion. In April
2015, the company got its hands on a whopping $400 million deal.

An official informed the Economic Times, “The deal could be finalized in
about 2-3 weeks.” “As Uber gets more aggressive in India,
Ola will need to burn more cash to maintain its market leadership
position,” another source further added.

An Ola executive said that the firm is targeting to raise $550 million at a
post-money valuation of $5 billion. According to the report, the company is might
be gearing up to bring new investors onboard.

Ola, which is a SoftBank backed company have investors including Russian
billionaire Yuri Milner’s DST Global, Singapore’s GIC and New York based hedge
fund Falcon Edge and also Tiger Global, Steadview Capital and Accel Partners
are major investors.

Ola, so far, has raised around $676 million in six funding rounds from over a
dozen investors.

“The company needs cash to invest further in new businesses as well as
continued discounting (for customers),” informed a source. Earlier this
year, Ola acquired another taxi-service provider TaxiForSure for $200 million,
and is currently present in around 10o Indian cities. Ola currently gets over
80% of its bookings through its mobile application. 

San Francisco-based Uber, which is valued at an estimated $50 billion, has too grown
swiftly in India since its launch in Bengaluru in 2013. It is now present
across 20 cities.

The company is currently working on several new initiatives, including
carpooling, on-demand food and grocery deliveries, on-demand bus aggregation
and logistics.

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