Internet portal Yahoo Japan Corp. said that it will acquire online fashion marketplace operator Zozo Inc. for about ¥400 billion.
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Yahoo Japan, a subsidiary of Softbank Corp., will spend the amount to take a 50.1 percent equity stake in Zozo in a tender offer, aiming to make it a subsidiary by year-end. The offer will open in early October at a price of ¥2,620 a share.
Yahoo Japan hopes to enhance its competitiveness against other online shopping sites such as those of Amazon Japan G.K. and Rakuten Inc.
For the acquisition, Yahoo Japan will use its own funds and take out loans.
Zozo’s market capitalization reached about ¥675 billion. The company will remain listed on the Tokyo Stock Exchange’s first section after the acquisition.
Zozo’s online marketplace, Zozotown, is one of the largest domestic fashion e-commerce sites, with some 1,300 retailers selling over 7,300 brands of clothing as of the end of June. Zozo has a customer base of about 8 million people, mainly youths.
Zozo said it has accepted Yahoo’s offer, adding that its founder and president, Yusaku Maezawa, has stepped down. Maezawa was succeeded by former director Kotaro Sawada, originally from NTT Data Corp.
Maezawa owns 36 percent of Zozo’s shares, and Yahoo will buy a 30 percent stake from him. The founder plans to focus on personal activities, such as his planned trip around the moon as the first passenger on a flight by U.S. rocket company Space Exploration Technologies Corp., known as SpaceX.
Competition in the Japanese e-commerce market is heating up, with new entrants piling in, such as online flea market operator Mercari Inc.
Zozo earned a group net profit of ¥15.9 billion for the year to March, on revenue of ¥118.4 billion. Its group had 1,130 employees as of the end of June.
(Source: Japan News)