A week after reports suggesting that Oyo is looking at acquisitions, the online hospitality major has announced its first business acquisition, entering into an agreement with Chennai-based service apartment company Novascotia Boutique Homes.
Oyo says that this is the first in a series of acquisitions, collaborations. innovations and launches it will be doing to grow its business.
“We are thrilled that our very first business acquisition involves an established brand like Novascotia. Though in the niche segment of boutique homes, Novascotia brings with it the expertise in catering to the corporate travel segment, an area we have seen great potential and established ourselves as the market leader with varied offerings across 230+ cities including all major corporate hubs,” Ritesh Agarwal, Founder & CEO of OYO said.
Oyo’s acquisition of Novascotia will help it strengthen its offering to corporate customers and help it create India's largest corporate service brand. The acquisition will boost OYO’s portfolio by 350 exclusive rooms across locations where Novascotia has its footprints further strengthening OYO's position as the largest full stack hospitality tech company in India.
“The acquisition forms an integral part of our inorganic growth plan, in line with our ambition to create beautiful and quality living spaces and adding value to every form of real estate. OYO is poised to deliver 180,000 keys by the end of 2018 and with Novascotia’s Strength, we will be adding service apartments to our existing portfolio - which includes budget rooms, OYO Townhouse, OYO Home, enabling us to offer a wide range of choices to our customers,” Ritesh adds.
Novascotia caters entirely to corporates and has a presence in Chennai, Coimbatore, Hyderabad, Kochi and Trivandrum and OYO plans to expand these offerings to 12 cities by the end of 2018. These serviced apartments are located in the heart of business hubs equipped with spacious rooms, upscale interiors, meals, gym and dining area to cater all the requirements of business travellers. The company has an EBITDA of 14%.
“Novascotia is a brand built over years with a lot of commitment and hard work. With OYO, we saw similar passion towards solving a problem and we are thrilled to become a part of the entity which is driven by perseverance and innovation. We are convinced that OYO with its wide experience in the hospitality business and hunger for delivering quality customer experience has every potential to take the Novascotia brand promise of ‘home away from home; forward. We are delighted with the support and professionalism received from OYO, its teams and our advisers at ANOVA Corporate Services for taking this to closure. We are excited to be onboard,” G. Madhu Manohar and Girja Madhu, Co-founders, Novascotia, said.
Oyo, which began its operations as a hotel aggregator, now works in close proximity with hotel partners through multiple operating formats and currently, over 95% of its business is being driven by exclusive full inventory partnerships.
Oyo claims that it has developed capabilities to add up to 10,000 rooms per month and will end the year with 180,000 keys.