India’s largest ride-hailing application Ola, operated by ANI Technologies Pvt. Ltd., has raised about $250 million (nearly 1350 crore) in fresh funding from Japanese telecom and internet major SoftBank Corp, revealed by the documents filed with Ministry of Corporate Affairs.
The documents threw light on the occasion and stated that Ola has issued 12,97,945 Series-I preference shares with a face value of Rs 10 each. It was then issued at a subscription price of Rs 12,905 that includes a premium of Rs 12,895.
The financing is Ola’s so-called ‘down round’ where a company raises money from investors at a valuation lower than its previous round of fund-raising. It was never officially announced but RoC (Registrar of Companies) showed that the round was closed in November last year.
The new round of funding by SoftBank would reassert its position as the major shareholder in Ola. After some calculation made by the sources last year, it was estimated that SoftBank held a 22.5% stake in Ola. It was followed by Tiger Global which is at 20.5%.
In the previous funding round, which was raised in August 2015, the company was valued at $4.8 billion. However, media reports suggests that the company’s valuation comes down to $3 billion in the current round.
The Bengaluru-based venture was desperately targeting to raise funds to compete with its main rival Uber, the world’s most valuable start-up. After selling its Chinese business to Didi last year, Uber has now set the target on India making it one of its top priority
It would be interesting to know that the Softbank is repeatedly making investments in Ola in spite of the fact that it has registered a whopping $350 million in losses from its investments The companies in which Softbank invested and tasted the loss were Snapdeal and Ola. This happened for the nine months period which finally ended December 31 last year.
Ola is now planning to work closely with the government of India and introduce the concept of electric vehicles in the top cities of the country. The expected time of this plan to come into action may take more than three months. This concept is expected to boost prospects for the Indian company.
Ola was founded in December 2010 by Bhavish Aggarwal and Ankit Bhati as an online cab aggregator in Mumbai, but is now based in Bangalore.