Sequoia Capital MD Steps Down From Oyo Board, To Have Observer Standing

 

Sequoia Capital managing director Mohit Bhatnagar, a long-term member on the board of Oyo Hotels & Homes, has resigned from his position as director at the SoftBank-backed hospitality chain, and will now hold a board observer position.

According to filings submitted by the Gurugram-headquartered firm with the Registrar of Companies, and which were accessed by business intelligence platform Tofler, Bhatnagar's resignation was effective June 30 earlier this year, and was accepted at a company board meeting on September 24.

Additionally, Bejul Somaia, partner at Lightspeed India Partners, will continue as a board member. Both Sequoia Capital and Lightspeed India are early institutional backers of Oyo, having first invested in the company in 2014, which was valued at about $10 billion at the end of its last funding round, and have also earned hefty returns from their respective partial exits last year.

In July last year, ET had reported that Lightspeed Venture Partners and Sequoia Capital, two of India’s biggest venture capital firms, were poised to rake in the richest cashout in the country’s startup ecosystem, after Oyo Hotels & Homes group chief executive (CEO) Ritesh Agarwal announced he was undertaking a $1.5 billion share buyback.

“We, at Oyo, are a board governed company and work closely with all our board members. Since day one, Mohit has played an important role in helping Oyo stay true to its mission and focus on creating value for our guests and asset partners alike. Going forward, Lightspeed and Sequoia jointly have one board and one board observer nomination on the Oyo Global Board. In that light, Mr Bejul Somaia will continue as the board member, and Mohit, who has been a fantastic thought partner to us, will be an observer on the Oyo Global Board,” Ritesh Agarwal, group CEO of Oyo, said in a statement.

The changes come as per the requirements of Oyo Global Series F Shareholders' Agreement, that have mandated the changes in the composition of the Oyo Global Board of Directors, a company spokesperson told ET.

In March, Oravel Stays, the parent company of hospitality chain Oyo Hotels & Homes, had received a capital infusion of about $807 million (around Rs 5,976 crore) from two of its backers, SVF India Holdings and RA Hospitality, the Ritesh Agarwal-controlled investment entity, as part of its ongoing $1.5 billion funding round.

In its regulatory filings with the Registrar of Companies, Oyo had allotted a total of 15,325 Series F compulsorily convertible cumulative preference shares (CCPS) to the two entities, at a price of $52,643.22 per share.

SVF India Holdings Limited had invested about $507 million, while RA Hospitality Holdings had put in about $300 million.

“Lightspeed and Sequoia jointly have one board and one board observer nomination on the OYO Global Board. Mohit will take on the role of the Observer on the OYO Global Board, and has therefore resigned from the board, and Bejul will continue as a board member,” a company statement said.

“I believe that Oyo is well-positioned to come out stronger from this pandemic that has deeply impacted the hospitality industry across the world. As an observer on Oyo's Global Board, we look forward to continuing our support of Ritesh and team Oyo's mission of bettering the hospitality industry,” Bhatnagar said in the prepared statement.

Oyo has been bulking up its global board, in the process, bringing on board multiple corporate veterans. In May, the company named former Starbucks Corp chief operating officer Troy Alstead as an independent board member.

The C-suite veteran joined Gerardo Issac Lopez, operating partner at SoftBank Vision Fund; Betsy Atkins, chief executive of Baja Corporation; Munish Varma of SoftBank Investment Advisers; Bejul Somaia, managing director of Lightspeed Venture Partners and Aditya Ghosh, on the Gurugram-headquartered company’s board. Ghosh had stepped down from his role as the India and South Asia head of Oyo, and joined the company’s Board of Directors, having spent barely a year in an operational role.

 

Sandip Ginodia , CEO

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