Airbnb raises $1 billion in debt as online rental marketplace witnessed drop in business

Online marketplace for arranging or offering lodging, primarily homestays, or tourism experiences Airbnb said it raised $1 billion from private firms amid coronavirus outbreak.

Airbnb said it raised $1 billion in debt and equity from private equity firms Silver Lake and Sixth Street Partners, as online rental marketplace seen its business dropped due to the COVID-19 pandemic.

Terms of the deal  not disclosed.

COVID-19  has prompted governments globally to issue stay-at-home orders, triggering a wave of cancellations in the travel and hospitality industries.

Airbnb emphasized that the funds would support its ongoing work to invest over the long term, a statement aimed at couching this raise as strategic and not a bailout in troubled times.

“While the current environment is clearly a difficult one for the hospitality industry, the desire to travel and have authentic experiences is fundamental and enduring,” Silver Lake co-CEO and managing partner Egon Durban said in a statement.

“Airbnb’s diverse, global, and resilient business model is particularly well suited to prosper as the world inevitably recovers and we all get back out to experience it.”

Airbnb CEO Brian Chesky acknowledged that while the desire to connect and travel reinforced during this time, the “way it manifests will evolve as the world changes.”

Airbnb betting how and where people work will evolve.

Last month, Airbnb said it would direct $250 million to help hosts who have been impacted by COVID-19.

The move was an attempt by Airbnb to make amends to its hosts who complained that the company’s policy would allow guests to cancel reservations and receive a full refund.