Ola raises half-a-billion dollars from Temasek and Warburg ahead of its IPO

• The company’s cofounder Bhavish Aggarwal will also be infusing an undisclosed amount.
• Ola was founded in 2010 by Aggarwal and Ankit Bhati.
• It had first announced its plans to go public in 2019.

Ride hailing giant Ola has raised $500 million from investment titans Temasek and Warburg Pincus, ahead of its initial public offering (IPO). The company’s chief executive and cofounder Bhavish Aggarwal will also be infusing an undisclosed amount in the Bengaluru-based startup in his personal capacity.

“Over the last 12 months we’ve made our ride hailing business more robust, resilient and efficient. With strong recovery post lockdown and a shift in consumer preference away from public transportation, we are well positioned to capitalise on the various urban mobility needs of our customers,” Aggarwal said in a statement.

Ola was founded in 2010 by Aggarwal and Ankit Bhati. The company has its presence across three continents. It has raised more than $4 billion to date from marquee investors like SoftBank, Tencent, Steadview Capital, Eternal, Sailing Capital, China Eurasian Economic Cooperation Fund and others.

It had been planning its public market debut since 2019. The company had also set up a pre-IPO trust in September 2019. Ola had also started to restructure its business with layoffs, optimising teams and adding more top executives to the mix. According to a Reuters report published in 2019, Ola was planning to hit the public market by March 2021.However the plans were obviously pushed back due to the Covid-19 pandemic.

Ola had to lay off about 1,400 employees from its workforce in May 2020, as its revenue had declined by 95% in the first two month of the pandemic-induced lockdown during wave one.

"The fallout of the virus has been very tough for our industry in particular. Our revenue has come down 95% over the past 2 months. Most importantly, this crisis has affected the livelihoods of millions of our drivers and their families across India and our international geographies," Aggarwal had told Ola employees in an email.

While Ola is planning its IPO, food delivery app Zomato is all set to hit the public market next week on July 14. The Gurugram-based company has set the offer price for its shares at ₹72-76 apiece, to raise ₹9,375 crore ($1.3 billion) through this issue.

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