What If Accor Acquires Oyo?
Photo Credit: The Oyo 101 Click Hotel, Dubai. Global presence is one of Oyo’s advantages. Oyo Hotels and Homes.
Skift Take
A full-blown acquisition or a stake in a tech-focused budget hotel player by a global hotel chain would be yet another strange development in the hospitality industry. But as we've seen, nothing is really strange anymore. This is an interesting development to watch, as the implications could be far-reaching.
Global hotel chains are often anything but direct. Look how they coin terms such as limited service, select service, lower midscale, to describe affordable accommodations. And most have avoided going lower than those levels to hit the floor where nightly rates are at $24, to use Oyo Hotels’ average room rate globally last year.
None have scaled this segment as Oyo has. Now in its sixth year of operation, Oyo says it has around 750,000 rooms, more than Accor, which Oyo’s research shows has around 685,000 rooms. Yet, despite Oyo’s global scale and funding of more than $1.7 billion from backers such as SoftBank and most recently Airbnb, global hotel chains largely still don’t see it as a competitor, or a true hotel company.
But what if one of them buys, or buys into, Oyo or another budget hotel chain?
Last month, the Economic Times of India speculated that Accor was in advanced talks to invest up to $40 million in Oyo’s rival, Treebo, citing people who were aware of th
