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Ola planning to raise around $1 billion from Temasek to surpass Uber

The deal will see secondary sale of shares by a large number of Ola investors, making it the first major liquidity event in the history of the company.

twitter-logo BusinessToday.in   New Delhi     Last Updated: March 6, 2018  | 18:03 IST
Ola planning to raise around $1 billion from Temasek to surpass Uber

Indian cab aggregator Ola is reportedly in talks with Singapore-based national wealth fund Temasek and other investors to raise funds between $500 million and $1 billion. The deal will see secondary sale of shares by a large number of Ola investors, making it the first major liquidity event in the history of the company, media reports said.

Ola's angel investor Rehan Yar Khan will sell his stake as part of the deal, a report by the Economic Times quoted persons familiar with the development. Other investors who received stocks in Ola after the acquisition of Taxiforsure in 2015 will also sell their shares. These investors include Accel India, Bessemer Venture Partners, Helion Venture Partners, and Taxiforsure founders Aprameya Radhakrishna and Raghunandan G., the report said.

This proposed round of fundraiser is expected to take Ola's valuation to $6-7 billion. The funds raised will go to the ride-hailing company's war chest, the report said. The Indian cab hailing application has been accumulating funds to compete against the US-based rival, Uber. However, neither Ola nor Temasek have confirmed reports of the deal yet.

Along with discussions on secondary trading, Ola and Temasek are also pondering on the latter acquiring primary stake in the cab aggregator. Both deals are likely to be closed at the same time, allowing the Singapore-based investment company to acquire a substantial share in the cab-hailing company. Temasek is also invested in Grab, Uber's rival in south-east Asia.

Recently SoftBank, Ola's biggest backer since 2014, also became the biggest shareholder in Uber too, raising speculations of both taxi service applications joining forces. The assumptions were turned down by Uber CEO Dara Khosrowshahi during his recent visit to India.

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