India’s ride-hailing company Ola is in expansion mode thanks to Singapore’s Temasek purchasing a whopping stake worth USD225 million. It is a major step in Ola’s larger plan to raise USD1 billion in the wake of its expansion strategy.
Ola has launched cab services in Australia as well as UK. The company made the announcement on August 7 that it is entering the UK where it will not only offer passengers the option to book private hire vehicles (PHVs), but also black cabs. The company is also planning to add other modes of transport on the same platform in the future.
Temasek purchased the stake from a group of early investors and is also in discussions with Ola’s management to pump more money into the company by way of subscription of new shares.
Temasek is a global investment company based in Singapore, whose portfolio spans a broad spectrum of industries, including financial services, telecommunications, media and technology, consumer and real estate, transportation and industrials, etc. Having such a strong investor on board will give Ola an edge to raise more funds in future.
In this round of investment, some early employees of Ola, including Rehan Yar Khan and VC investors like Accel India, Bessemer Venture Partners, Texiforsure founders Aprameya Radhakrishna and Raghunandan G, etc, will sell some of their shares in Ola.
This investment will enable Ola founder Bhavish Aggarwal to diversify the company’s shareholder base.
Ola was last valued at USD4 billion when it raised USD400 million from Chinese internet conglomerate Tencent in September 2017.
Ola has launched new categories of services including inter-city travel over the past 18 months and is present in 110 cities across India
The company charges a commission from drivers who use the application to ferry customers. It also needs to incentivise the drivers to use its application as the preferred mode of acquiring customers in the face of stiff competition from Uber.