Softbank-backed Oyo in legal spat with rival Zostel ahead of $1.2-bn IPO

SoftBank Group-backed Oyo Hotels and Rooms is facing a legal tussle with rival Zostel ahead of its up to $1.2 billion market debut over a deal between the two Indian hospitality startups that fell apart six years ago.

Oyo is looking to raise between $1 billion and $1.2 billion through a new share issue and an offer for sale from existing shareholders. The company is set to file draft initial public offering documents this month, Reuters reported last week, joining a wave of Indian start-ups looking to go public this year.

But Zostel filed a petition in August with the Delhi High Court to stop Oyo from changing its shareholder structure, including through an IPO, the petition, seen by Reuters, said.