17 mars 2021
Rakuten stock jumped 24% on Monday. The Japanese e-commerce company will sell shares worth 1.86 billion euros to several companies, including Japan Post and Tencent, in order to compete with Amazon.
Rakuten stock was trading up 18% at 1,471 yen by 02:28 GMT on Monday – the biggest increase in seventeen years – after hitting 1,545 yen earlier today. Since Friday, the shares of the Japanese company have surged nearly 30% in total, bringing its market capitalization to 2.1 trillion yen (16.2 billion euros).
The operation makes it possible to inject funds into the capital of Rakuten to invest massively in the fields of logistics – where the group competes with Amazon and SoftBank, which has just strengthened its activities on the Internet -, and of mobile telephony, where it attacks the three incumbent operators by launching its own mobile network.
“Rakuten could benefit from significant support from this expert in logistics services”, decrypts Hiroko Sato, analyst at Jefferies, who refers to Japan Post and its 24,000 post offices scattered throughout the archipelago.
Mobile e-commerce sales have so far represented “a huge drag on valuations and profits, for some time now, but costs will peak this year before falling again,” predicts Amir Anvarzadeh, analyst at Asymmetric Advisors , in a report.
Another advantage of the operation: potential partnerships with backers Tencent, the world’s largest video game company, and Walmart, the world’s largest retailer, which has also offered Rakuten shares and is launching a counter- offensive in the digital field against Amazon in the United States.
Rakuten, which suffered an operating loss in 2020, faces challenges on several fronts: competition from Amazon in e-commerce on the one hand, and from the very wealthy Japanese telecommunications companies on the one hand. ‘somewhere else.
“Rakuten is the ideal partner, thanks to its cutting-edge digital technology,” said Hiroya Masuda, managing director of Japan Post Holdings, at a press conference last week.
This transaction makes Japan Post the main shareholder of Rakuten apart from the Mikitani family, who founded the company. In total, Rakuten sells nearly 242 billion yen (1.86 billion euros) of shares. A former public company now privatized, Japan Post Holdings can be found on almost every street corner in Japan, with its postal department numbering around 24,000 post offices across the country.
“In the face of growing tech giants, we are joining forces,” says Rakuten Managing Director Hiroshi Mikitani.
This month, chat application operator Line merged with Yahoo Japan, SoftBank’s internet-based subsidiary, in an agreement announced in 2019.
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