Hospitality technology company Oyo on Monday announced it is actively pursuing acquisitions in the United Kingdom and plans to invest £50 million ($62 million) in the country over the next three years.
Oyo said it is looking to buy premium hotel brands. This is part of its broader strategy to transition from budget accommodation to a more diversified, quality-focused offering.
The company said it is in “advanced stage discussions” with several large hotel chains and real estate companies.
Last month, Oyo raised INR 5.5 billion (around $63 million) from founder Ritesh Agarwal’s Redsprig Innovation Partners. The company said then that it would use the funds to drive growth, support global expansion initiatives — including acquisitions. In December, Nuvama Wealth & Investment Limited (formerly Edelweiss Securities) acquired Oyo shares worth INR 1 billion ($11.5 million) on behalf of a consortium of family offices.
Oyo founder and CEO Ritesh Agarwal will be live on stage at Skift India Forum in Delhi-NCR on March 17-18 to dive deeper into Oyo’s expansion plans.
From Budget to Boutique
Known for its expansive network of over 200 budget hotels across 65 cities — including key hubs like London, Manchester, Birmingham, Cardiff, and Brighton — Oyo is now pivoting towards high-end properties.
Puneet Yadav, Country Head, Oyo UK, emphasized this shift, stating, “Oyo entered the UK market in 2018, leveraging a model that had already proven successful in other global markets.”
Yadav said that while the company continues to cater to the budget segment, its is now focused on expanding through leasehold agreements and management contracts with premium properties. “Additionally, we plan to introduce several of our popular European brands to the UK market.”
In 2024, parent company Oravel Stays launched Sunday Lansbury Heritage near London’s Canary Wharf, marking the launch of its premium segment.
Similarly, the launch of Belvilla by Oyo — in partnership with UK apartment rental chain Sojo Stays — has expanded the reach of its premium vacation home rental brand across prime locations such as London, Birmingham, and Sheffield.
A Global Expansion Blueprint
Oyo’s UK business is part of a larger strategic transformation that spans multiple geographies. The company’s international expansion has seen a flurry of acquisitions and brand launches, especially in the U.S. and Europe.
U.S. Footprint: Last year, Oyo acquired Motel 6 and Studio 6 hotel brands from Blackstone for $525 million.
European Moves: In 2024, Oyo also acquired the Paris-based Checkmyguest for $27.4 million. Oyo’s 2022 acquisitions include Croatian vacation rental agency Direct Booker for $5.5 million, and the Nordic holiday home operator Bornholmske Feriehuse. Pre Covid Oyo’s purchase of Amsterdam-based @Leisure Group for $415 million in 2019 further cemented its position in the European market.
Oyo has been pushing the expansion idea. “I see growth ahead not just in India with emerging travel trends such as premiumization, spiritual travel, business travel and conferences, destination weddings but also in our other key markets of Nordics, South East Asia, U.S. and UK,” Agarwal had said in a tweet touting Oyo’s first profit.
Economic Impact and Future Prospects
Oyo estimates that its planned investments will support around 1,000 direct and indirect jobs over the next three years.
This injection of capital and focus on premium properties comes at a time when the UK tourism sector is experiencing a resurgence. The Oyo Travelopedia Report recently noted an 18% year-on-year increase in bookings, with cities like London, Plymouth, and Sheffield leading the surge, and coastal regions like Eastbourne witnessing growth.
A January report by the RSM Hotels Tracker revealed that in 2024, consumers are increasingly “trading up” in their accommodation choices, with demand for luxury and mid-market hotels on the rise, while budget hotels face a decline.
