Zostel on Sunday said it has won the three-year long legal battle against Oravel Stays, which owns and operates hotel chain OYO.
About Case
According to Zostel Hospitality, ZO Rooms and Oyo had entered into talks for a merger in 2015, executing an agreement on 26 November that year.
ZO Rooms completed its obligation under the agreement and transferred the business, but Oyo failed to transfer 7% to the ZO Room’s shareholder, which eventually led to the recently concluded arbitration
However, according to OYO, while the order noted that the non-binding term sheet is to be held as binding, the term sheet itself has several key elements like assets, value, etc. including commercials that were not agreed within the term sheets itself.
The company said that only legal costs were awarded as damages to ZO Rooms even as “the award of specific performance of non-binding term sheet (which in itself has no agreed financials) is subjected to initiation of further proceedings and likely to get challenged.”
Comment from Zostel
Paavan Nanda, former Co-founder, “Beyond the monetary compensation, it was a fight for our rights and reputation. We are extremely relieved with the judgement that the arbitral tribunal has pronounced after diligently evaluating the merits and evidences produced by us over the last 3 years.”
What next?
Now, Zostel will take the judgment to Oyo to fulfil the obligations under the term sheet and transfer the shares.
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