Internet group Tencent has reached the advanced stage of negotiations to invest $400m in India-based ride hailing platform Ola, the Economic Times reported today, citing four people aware of the talks.
Originally known as Olacabs, Ola enables users to book rides on demand in taxis or chauffeured car rides, and on auto rickshaws and shuttle buses, in some 110 Indian cities using its app. It has also launched a mobile payment platform called Ola Money.
The company is in the process of raising up to $600m in series G funding, according to reports in November 2016, and has already secured $330m from telecom group SoftBank and two unnamed existing investors, as well as a sub-$50m sum from hedge fund Tekne Capital Management.
Tencent executives met Ola’s management team last week to discuss the prospective investment, one of the sources told ET. The China-based company could lift the size of the round above the $800m mark, and Ola’s valuation to more than $4bn.
The source also confirmed recent reports that software provider Microsoft is considering investing in Ola’s next round, but said the talks are at an earlier stage.
Prior to the current round, Ola had raised about $1.25bn in funding from backers including SoftBank, China-based ride hailing platform Didi Chuxing, Baillie Gifford, Falcon Edge Capital, Tiger Global Management, DST Global, Steadview Capital, ABG Capital, Fii Ltr Focus Fund, JS Capital, Parkwood Bespin, GIC and Vanguard Group.
Tencent would participate as a new investor, but it has backed India-based companies including e-commerce company Flipkart, digital health portal Practo and learning app Byju’s this year, and has also invested in ride hailing services Didi Chuxing and Lyft in the past.