FILE PHOTO: The Airbnb logo is seen on a little mini pyramid under the glass Pyramid of the Louvre museum in Paris, France, March 12, 2019. REUTERS/Charles Platiau
(Reuters) – Airbnb said on Monday private-equity firms Silver Lake and Sixth Street Partners would invest $1 billion in the U.S. home rental company through a combination of debt and equity.
Financial details of the deal were not disclosed but Reuters reported last week that the company had lowered its internal valuation by 16% to $26 billion.
In March, Reuters had reported that Airbnb held a phone meeting with bankers to discuss extending an existing $1 billion debt facility amid a slowdown in demand due to the coronavirus pandemic.
The company said it would use the funds primarily to attract more hosts, or homeowners who list their properties for rent on the company’s platform.
Airbnb said it would also focus on long-term stays and on its service that organizes local activities.
In response to travel bans and a surge of requests for cancellations, the short-term home rental platform said last week that it was allocating $250 million to help offset losses incurred by hosts.
The company said on Monday that $5 million from the Silver Lake and Sixth Street investment will be contributed to a relief fund for hosts in need of financial assistance.
The U.S. startup announced plans to list its shares in 2020 last September and has not changed that position so far.
Reporting by Noor Zainab Hussain and Shariq Khan in Bengaluru; Editing by Shinjini Ganguli and Anil D’Silva