Oyo, a travel tech company is currently preparing to refile IPO papers for a refinancing loan as it is nearing finalization rounds. The company was said to be looking to raise up to $450 million through its  sale of dollar bonds. The financing round is expected to be led by JP Morgan. According to a report by  PTI, the bond is expected to carry a 9 to 10% interest rate per year. 

The company is already planning to refile an updated version of DRHP after the completion of bond  insurance. Oyo has already submitted the documents to withdraw its current draft red herring  Prospectus with the market’s regulator SEBI. The refinancing will surely make material changes to  OYO’s financial statements. Therefore, as per the existing rules of SEBI, it will need to revise its filings  with its regulator.

The company is aiming for $350-$450 million through bond insurance at an  estimated interest rate of up to 10%. According to Social News XYZ, the refinancing will result in annual  interest savings of $8 to $10 million in its first year, after accounting costs associated with bond  insurance. The company is estimating its annual savings to be around $15 TO $17 million.  

The company mentioned that the decision for refinancing is at an advanced stage so they are pursuing  the revised financial plan, as the IPO approval with the current one does not make any sense. Some  reports also mentioned the time of the whole refinancing process extending the repayment time to  five years from 2026, which will be completed in the next three months. According to a report by PTI,  an individual close to this whole IPO plans of the company said that the refinancing is predicted to  have annual interestsavings of $ 10 million in the first year after accounting costs associated with bond  insurance.

Before the post-refinancing round, the company will be open for an equity round to get  investors’ confidence before public listing to gain financial strength. In 2021, OYO filed preliminary  documents with the Securities and Exchange Board of Indi for Rs 8,430 crore IPO. The IPO launching  was delayed due to market conditions, as the company had to settle for a lower valuation of $4 to $6  billion instead of a predicted valuation of $11 billion.  

Conclusion: 

A travel tech company, OYO is currently in preparation to refile IPO papers for a refinancing loan as it  is nearing finalization rounds. The company was said to be looking to raise up to $450 million through  its sale of dollar bonds. The financing round is expected to be led by JP Morgan. According to a report  by PTI, the bond is expected to carry a 9 to 10% interest rate per year.

IPO plans of the company said that the refinancing is predicted to have annual interest savings of $ 10 million in the first year after accounting costs associated with bond insurance. Before the post-refinancing round, OYO will  be open for an equity round to get investors’ confidence before public listing to gain financial strength.