Oyo Enters Co-Working Business With Innov8 Acquisition Deal
Hospitality firm Oyo Hotels & Homes announced its entry into a new vertical, Oyo Workspaces, targeting the co-working opportunity in India. It aims to have 50 centres across the country with a total seat count of around 35,000 by the end of 2019.
OYO also formally announced the acquisition of co-working firm Innov8 during the year. Currently, Innov8 has 16 centres across the country with over 6,000 seats.
While financial details of the Oyo-Innov8 acquisition deal weren’t disclosed, sources said Oyo bought Innov8 for $30 million, or about Rs 205 crore. The entire team of Innov8 has also joined OYO as part of the deal.
The debut of Oyo Workspaces follows a multi-brand approach with introduction of three brands: Innov8, which is an upper mid-scale brand; Powerstation, a mid-scale brand; and Workflo, which is an economy brand.
Oyo Workspaces will open the doors to 21 co-working spaces, with over 15,000 seats across more than 10 cities.
"For 2019, we plan to have 50 centres that are operational across India, with a total of around 35,000 seats," Oyo’s New Real Estate Businesses Chief Executive Officer Rohit Kapoor said.
When asked about the investment Oyo will be making on the expansion, Kapoor said the investment on this would be part of already-announced Rs 1,400 crore investment for India and South Asia for the year.
"Oyo Workspaces is premised on the belief that there is a huge disconnect between demand and supply of quality managed co-working spaces," Kapoor said. Oyo Workspaces uses technology and operational expertise to fix this problem, he added.
While Innov8 at present is the largest of three brands, Powerstation has one centre at Gurugram with over 1,000 seats and Workflo has set up four centres across National Capital Region centred on Delhi, Hyderabad and Bengaluru with over 1,500 seats.
Oyo plans to become the largest multi-brand co-working space in Asia, an endeavour which is part of its Vision 2020. "This alliance will work towards simplifying and strengthening the co-working experience for Indians while tapping the enormous opportunities this space offers," Innov8 founder Ritesh Malik said.