MakeMyTrip may acquire stake in OYO; to delist Treebo, FabHotels
Online travel portal MakeMyTrip is further strengthening its renewed partnership with budget hospitality chain OYO by delisting all the properties of OYO rivals, such as hotel aggregators Treebo and FabHotels, from its platforms, a media report said, citing two people in the know.
MakeMyTrip may also pick an equity stake in OYO, The Economic Times reported, citing one of the persons mentioned above.
The two companies had announced a new partnership in February this year, where OYO will list its hotels across India, Malaysia and Nepal on all platforms run by MakeMyTrip. The partnership came more than two years after MakeMyTrip had removed OYO’s inventory from its platform citing strategic overlaps.
As part of the deal, MakeMyTrip will delist hotels under Treebo and FabHotels from both its platforms, MakeMyTrip and Goibibo, the ET report said.
Goibibo has already begun promoting OYO properties on the platform and has ported hotel reviews to its platform from the latter to achieve greater search results. The partnership also entails a special clause for MakeMyTrip and Goibibo customers who will receive preference when making last minute bookings of OYO Rooms over other OTAs like Yatra and Cleartrip, the report said.
Separate queries send to MakeMyTrip, OYO, Treebo and FabHotels did not elicit any immediate response at the time of publishing this report.
Founded in June 2015 by former McKinsey and Myntra executives Rahul Chaudhary and Sidharth Gupta and former MakeMyTrip executive Kadam Jeet Jain, Treebo Hotels works on a full inventory model. The budget hotel chain now has over 6,000 rooms across 300 properties in over 50 cities in the country. The company had raised $34 million (Rs 220 crore) in its Series C funding round in August last year, led by Hong Kong-based investment firms Ward Ferry Management and Karst Peak Capital. SAIF Partners, Matrix Partners India, and Bertelsmann India Investments have invested in the company.
FabHotels was founded in 2014 by Vaibhav Aggarwal and Adarsh Manpuria. In July 2017, it raised $25 million (Rs 161 crore) in a Series B round led by Goldman Sachs Investment Partners. Accel Partners and Qualcomm Ventures are its other investors. The company works on an asset-light model, wherein it uses the technology platform to promote its partner hotels with capacities of 20-40 rooms, and provides standardised services to budget travellers. FabHotels operates over 5,000 rooms across 225 franchise hotels in over 20 major Indian cities, including Mumbai, Delhi-NCR, and Bengaluru.
Soon after blocking OYO in 2015, MakeMyTrip had launched its own version of budget hotels, which it branded ‘Value+’. Goibibo, which was merged with MakeMyTrip early last year and had also blocked OYO at one time, aggregates unbranded budget accommodations via GoStays.
OYO was founded in 2012 as a budget hotel aggregator by Ritesh Agarwal, who was just 17 years old at the time. OYO is its budget brand which follows the marketplace model. Townhouse, which OYO launched last January, is a managed hotel brand positioned as a friendly neighbourhood accommodation.
The firm, which is backed by Japanese conglomerate SoftBank, operates in 230 cities across India, Malaysia and Nepal.
In an interaction with TechCircle in January this year, Agarwal said that the firm has repositioned itself as a franchisee/hotel operator and is currently moving its whole inventory in that direction.
Nasdaq-listed MakeMyTrip Ltd said that it had doubled its revenue but posted a loss in the third quarter of the financial year 2017-18. The firm had turned in a profit in the corresponding quarter of 2016-17.