Mobility major, Olahas raised $500 million through a Term Loan B (TLB) from international institutional lenders.

The proposed loan issuance is said to have received a commitment of approximately $1.5 billion from investors.  The company did not sharemore details on the time period of the loan, interest rate, and lenders.

S&P and Moody's rated Ola’s first lien term loan as B- and B3 respectively, with a ‘stable’ outlook, on the back of strong unit economics and profitabilityin its Indian ride-hailing business. Ola is expected to utilize the term loan to fuel its vision for the future of mobility across its various businesses including ride hailing, vehicle commerce, delivery with foods,quick commerce and financial services.

Bhavish Aggarwal, Founder and CEO, Ola said “The overwhelming response to our term loan B is a reflection of the strength of our business and our continued focus on improving unit economics alongside rapid growth. At Ola, we are accelerating our journey towards building the New Mobility ecosystem tohelp a billion people move sustainably.”

J.P. Morgan and Deutsche Bank served as the joint lead arrangers for this financing.

Earlier this month, Ola raised$139 million funding from Edelweiss and others, at a valuation of about $7.3 billion. Other investors in this round included Siddhant Partners, IIFL, Tejal Merchantile, HeroEntreprise,  Vicco Laboratories, Alka DP Family Trust, and Atul DP Family Trust among others.  Also in July, Temasek, Warburg Pincus and cofounderBhavish Aggarwal had invested $500 million in Ola.

Ola hasreported a positive EBITDA of ₹89.82 crore (on a standalone basis) for the financial year that ended in March 2021, which is a 109 per cent improvement on a year-on-year basis. Thecompany also reported a profit before tax of ₹76.29 crore in FY 2021 on a standalone basis, an improvement of more than 2x on a year-on-year basis.

During the year, the company has earned a total revenue of ₹772.68 crore as compared to the last year’s income of ₹2,073.02 crore. The severe drop in revenue was attributed to the Covid-19pandemic and the nationwide lockdown imposed by the Indian government. Ola is looking to go public by next year and is estimated to raise around $1 billion - $2 billion fromthe IPO.

 

Also read: Ola starts e-scooter delivery in Bengaluru and Chennai

 

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