Published: Fri, January 17, 2020
Markets | By Otis Pena

OYO to lay off 1,000 employees as part of restructuring plan

OYO to lay off 1,000 employees as part of restructuring plan

"The decision to layoff such a huge number of employees can also be attributed to the plans of Oyo to list publicly in the U.S. within the next three years", the record included.

In recent months, OYO "has also made a successful transition from many of our colleagues to more meaningful roles within OYO by providing mentoring, training and tools to succeed", he added. SoftBank reportedly gave Oyo a deadline of March 31, 2020, to phase out contracts or businesses that are not EBITDA-profitable.

And this means that, unfortunately, some roles at OYO will become redundant as the company further drives tech-enabled synergy, enhanced efficiency and removes duplication of effort across businesses or geographies, Agarwal wrote in the mail.

Acknowledging the severity of his decision and apologising to his "OYOprenuers", Ritesh said that the company will do everything to ensure that the outgoing employees receive as much assistance and support as possible.

"Every OYOpreneur is important to OYO and ensuring their well-being during and after their term is our number one priority".

SoftBank-backed 9984.T Oyo Hotels and Homes is laying off hundreds of employees in India, according to a source and an internal memo seen by Reuters, as the loss-making hotel chain cuts costs in pursuit of profits. The company has let go of 5% of its 12,000 employees in China partly due to non-performance and is dismissing 12% of its 10,000 staff in India.

Climate Change to Impact . .
However, some critics were less impressed by BlackRock's statement, pointing to Fink's lack of meaningful action so far. However, fears of a global slowdown have moderated through 2019 and investors have started to take on risk, he added.

Very recently, there was news about Oyo's plans of firing 3000 employees in India and China.

Earlier last month, Oyo reorganized its leadership team with changes including elevating India and South Asia CEO Aditya Ghosh to its board of directors and appointing Rohit Kapoor as its new CEO for India and South Asia.

The Economic Times, an Indian publication, first reported in December that job cuts at Oyo were coming.

Is 2020 Over Yet?: 2019 was a rough year for SoftBank, with the WeWork IPO fiasco and decreased expectations from Vision Fund 2. But of late it is drawing flak from a section of hotel owners that Oyo was taking up half or more of revenues through fees that were not initially disclosed.

Last October, regulators opened antitrust investigations into Oyo and hotel-booking platform MakeMyTrip after hospitality firms and industry bodies complained the two companies were stifling competition. While the expenses for the company also grew 3.9X, OYO's revenue increased by 3.5X in FY19 as compared to FY18.

SoftBank declined to comment on Oyo and other startups in which it has invested. Federation of Hotels and Restaurant Association of India has approached the Competition Commission of India to register a complaint against the hospitality chain for allegedly levying charges without prior intimation.

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