Mumbai: Indian Startup Hospitality Zostel has requested a market regulator to reject the application from the rival of Softbank, Oyo hotels and rooms to go public because of the legal movement between a messy company six years ago.
Zostel said the OYO capital structure was not final and that the design of the prospect was submitted with the effects and the Council of India (peers) “full of material negligence,” showing a copy of the Zostel letter sent to Reuters.
Oyo said Zostel intervention represents “unnecessary and repetitive efforts to create wrong perceptions”.
“This shows the Zostel pattern that tries to distract Oyo to pursue its business goals,” he said in a statement to Reuters.
Oyo submitted a paper at the end of September for the initial public offering (IPO) which will consist of new shares issues of up to 70 billion ($ 927.30 million) and offer for the sale of existing shares as much as 14.30 billion.
This is looking for a $ 10 billion rating of $ 12 billion, a source to Reuters this month.
Oyo and Zostel have been in a legal battle on the 2015 agreement for Oyo to buy some Zostel and Zostel businesses to get 7% shares in Oyo.
Although the deal fell, Zostel said it was still entitled to stock, while Oyo said the opposite, with the reason they had not reached a definitive agreement.
Zostel has asked the Delhi court to stop Oyo from changing its shareholders structure, including through the IPO, according to the petition previously seen by Reuters.
In his letter to Sebi on October 11, Zostel said SBI regulations forbade Oyo to offer a public offer of its shares because they had not issued shares to Zostel shareholders.
Separately, Oyo has challenged the command of the Arbitrator appointed by the Supreme Court who decided that the provisions of the 2015 agreement binded and that Oyo violated his obligations by failing to implement a definite agreement.
An oyo adviser told Reuters on Monday on Monday not in order that prevents Oyo from advancing with his IPO.
Zostel and SEBI do not respond to comment requests outside of regular working hours.