New Delhi: OYO, the global travel tech behemoth funded by Softbank, is set to resubmit its highly anticipated Initial Public Offering (IPO) application as refinancing efforts reach completion.
Notably, efforts are underway to raise up to $450 through the issue of dollar bonds, with JP Morgan leading the refinancing initiative at an estimated annual interest rate of 9-10 percent.
In preparation for this financial restructuring, OYO has begun the process of withdrawing its current draft red herring prospectus (DRHP), which was submitted to market regulator SEBI. The corporation wants to resubmit an updated version of the DRHP once the bond offering is completed.
In November, OYO's parent firm, Oravel Stays Ltd, paid off a major portion of its debt of Rs 1,620 crore through a repurchase process. The repurchase includes repurchasing 30 percent of its outstanding Term Loan B of $660 million. The move reduced its outstanding loan amount to approximately $450.
A source close to the company's IPO ambitions told PTI that the refinancing will result in major changes to OYO's financial accounts. As a result, it will be required to modify its regulatory filings in accordance with current regulations. According to the source, the refinancing will lengthen the payback timetable to five years, compared to the remaining TLB installment due in 2026.
The bond offering would drastically reduce the current effective interest rate of 14 percent on its existing $450 Term Loan B (TLB) facility.
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