Zostel asks Sebi to reject and suspend Oyo’s $1.2-billion IPO

Zostel Hospitality has written to India’s securities regulator, the Securities and Exchange Board of India (Sebi), seeking that Oyo’s draft red herring prospectus (DRHP) be rejected and the company’s scheduled initial public offering (IPO) be halted (IPO).

Sebi’s clearance process could be slowed as a result of the relocation. According to a copy of the case acquired by Business Standard, the $1.2-billion IPO is “non-maintainable as Oravel Stays’ capital structure is not finished.”

In light of the provision stated in Regulation 5(2) of the Sebi (Issue of Capital and Disclosure Requirements) Regulations, 2018, Oravel’s filing of the DRHP in the current circumstances is invalid (ICDR Regulations).

Oyo, for its part, claims that all it did was offer them instructions on how to demand particular fulfillment of the non-binding term sheet. The tribunal had determined and said plainly that the formal agreements had not been finalized or agreed upon.