SoftBank pulls out of Latin America partnership with Oyo Hotels
11/02/2021 23:30
By Carolina Mandl and Daina Beth Solomon
SAO PAULO, Feb 11 (Reuters) - The Latin American unit of
Indian hotel startup Oyo Corp 9755.T has ended its joint
venture with the SoftBank Latin America Fund, less than six
months after they struck a partnership in the region, both
companies said on Thursday.
Oyo's business in Latin America, known as Oyo Latam, on
Wednesday said it was moving to a digital-only model, and that
the changes would require laying off nearly its entire staff.
SoftBank Group 9984.T has poured $75 million into Oyo in
Latin America, part of its more than $1 billion investment in
the parent company.
Although hotels in the region can still operate under Oyo's
brand, operations will now be managed directly from Oyo's home
base in India, an Oyo Latam spokeswoman told Reuters.
"The Latin American joint venture (with SoftBank) has ceased
to exist," she said, adding that did not mean Oyo was completely
shutting down in the region. "It was another adaptation due to
the pandemic," she said.
Japan-based SoftBank added the decision was made jointly
with Oyo due to challenges brought about by the coronavirus
pandemic, and that it would no longer invest in the company in
the region.
In September, Reuters reported that SoftBank was taking a
more direct role in the virus-hit hospitality startup through a
joint venture in Latin America to manage roughly 1,000 hotels.
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Oyo has struggled across its markets worldwide as the
coronavirus crisis pummeled the tourism industry, and has
drastically scaled back its workforce.
(Reporting by Daina Beth Solomon in Mexico City and Carolina
Mandl in Sao Paulo; Editing by Bill Berkrot)
((daina.solomon@thomsonreuters.com; +52 55 5282 7150;))