Rakuten Inc. Chairman and CEO Hiroshi Mikitani, left, appears at a March 12 news conference alongside Hiroya Masuda, president and CEO of Japan Post Holdings Co. (Ryo Inoue)
Online retailing giant Rakuten Inc. will receive its biggest capital injection since its establishment in 1997 with the bulk of it coming from Japan Post Holdings Co. to help it develop its still fledging mobile phone operations.
The 150 billion yen ($1.4 billion) investment by Japan Post Holdings will make it Rakuten’s fourth largest shareholder and give it a roughly 8-percent stake in the company.
In addition to Japan Post Holdings, Rakuten will also receive capital from a subsidiary of Chinese information technology company Tencent Holdings Ltd. as well as U.S. retailer Walmart Inc. The total capital injection will come to about 242.3 billion yen.
Japan Post, Rakuten tie-up in digital delivery, cashless pay
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Japan Post, Rakuten tie up in digital delivery, cashless payments
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Mar 12, 2021
Rakuten Inc. plans to raise ¥242 billion ($2.2 billion) by selling shares to investors including Tencent Holdings Ltd., Walmart Inc. and Japan Post Holdings Co., bankrolling expansions into AI, finance and mobile.
Japan Post will buy a stake of 8.32% via new and existing shares in Rakuten while China’s social media leader and the U.S. retail giant will take smaller slices, a filing showed Friday. Shares of Rakuten and Japan Post surged as the agreement builds on an existing alliance on logistics forged by the two last year.
The Japanese e-commerce pioneer has benefited from a boom in online shopping during the pandemic, but faces stiff competition from Amazon.com Inc. Last year, the company scaled back plans to offer free shipping after pushback from sellers using its platform prompted regulatory scrutiny. Rakuten is also expanding rapidly into wireless mobile, hoping to disrupt the staid industry.