04 May 2017, India:
One of India’s leading online travel firm MakeMyTrip has raised $330 million in the latest round of funding led by its existing investors Naspers and Ctrip as per the report by ToI.
Ctrip.com International Ltd. is China’s leading travel booking services provider whereas, Naspers is South African media group. The latest funds will go toward business expansion, technology and product development, working capital and general corporate purposes. Other major investors, apart from Kalra who holds 9.95% stake, are SAIF Partners (14.41%) Travogue (7.11%) Wasatch Advisors (10.79%), and T Rowe Price (9.66%).
MakeMyTrip was founded in 2000 as an online travel company by Deep Kalra and Keyur Joshi. The company “holds close to 25% market share of the OTA hotel booking segment” as per the report by NewsBytes.
A company statement said MakeMyTrip will issue 3.6 million Class B shares to Naspers’ subsidiary MIH Internet at a price of $36 per share totaling to $132 million. These class B shares will be convertible into ordinary shares on a one to one basis, the company said in its filing. The company is also issuing 916,666 ordinary shares to China’s Ctrip International at $36 per share, totaling additional funds worth $33 million.
“We will deploy the new funds in strengthening our portfolio of international hotels and flights as well as alternative budget and luxury accommodation. Our main focus will be on increasing the contribution from hotels from 50% at present to 70% by 2020. There is a tremendous headroom for growth in the hotel category because online penetration is just 15% at present and the market is fragmented. Hotels also offer higher margins,” said Rajesh Magow, CEO, MakeMyTrip.
The latest deal would mean South Africa’s Naspers will continue to be the single largest shareholder in MakeMyTrip while Ctrip will get an additional hold in India’s OTA market through its increased stake in the company. (Image- vencom.in)