press trust of india
New Delhi, Oct 3: Ola is getting $2 billion funding from a group of investors that includes SoftBank Group and Tencent Holdings, said industry sources. The funding, part of which has already come in, will help Ola bolster its position against US-based rival Uber.
The two are engaged in an intense battle for leadership in the Indian market and have pumped in millions of dollars in driver incentives and discounted rides for customers. Multiple sources, who did not wish to be identified as the discussions are private, said the round is yet to be closed and the numbers could add up to about $2 billion when it happens.
An announcement could be made in the next few weeks, they added. Ola and SoftBank declined to comment on the matter while Tencent was not immediately available. ANI Technologies — which runs Ola — has already raised multiple rounds of funding this year. According to documents filed with regulatory authorities, it raised over Rs231 crore from Tekne Private Ventures through issue of preference shares in June.
In March, the SoftBank-backed Ola had raised Rs670 crore ($104.4 million) in funding from investors including UC-RNT Fund, a venture between the University of California and leading industrialist Ratan Tata. ANI Technologies, which is not a publicly-traded company, counts among its investors names like SoftBank Group, Tiger Global, Sequoia India and Accel Partners US.
Its revenues registered a stellar growth at Rs758.23 crore during 2015-16 compared to Rs103.77 crore in the previous fiscal. However, it posted a consolidated loss of over Rs2,311 crore — about Rs6 crore a day — during that fiscal on account of heavy advertising and promotional expenses and other costs. Earlier this year, SoftBank and Tencent invested in India’s largest e-commerce firm, Flipkart. The $2.5-billion funding was made through SoftBank Vision Fund.