(Bloomberg) -- In a country where workplaces play an outsized role in people’s lives, Japan is betting that enlisting its largest corporations to roll out Covid-19 vaccines will add fuel to a much-scrutinized inoculation drive.Still grappling with a rollout that’s deployed only enough doses to cover 11% of the population, the Japanese government is allowing its biggest corporate brand names and employers like Toyota Motor Corp., SoftBank Group Corp., and Nomura Holdings Inc. to administer shots
(Bloomberg) -- Rakuten Inc. shares recorded their biggest gain in 18 years after investors bet that a $2.2 billion stake sale and deepening collaboration with partners like Tencent Holdings Ltd. and Japan Post Holdings Co. will help the company acquire customers and shore up its logistics network.The stock rose its maximum of 24.1% in Tokyo, pushing Rakuten’s value up by more than $3 billion, after it announced Friday it was raising 242 billion yen selling stock to investors including Tencent, Japan Post and Walmart Inc. Japan’s e-commerce pioneer intends to use the funds to expand its capabilities in artificial intelligence, financial technology and mobile networks. It recently became the fourth mobile carrier in its domestic market, undercutting the incumbents with aggressive pricing.Read more: Rakuten to Raise $2.2 Billion as Japan Post, Tencent InvestThe deal is expected to help bankroll Rakuten’s costly effort to build out its delivery network and compete with Amazon.com Inc. It plans to create joint logistics centers with Japan Post, sharing data and delivery and pick-up systems to improve efficiency.Bringing together Rakuten’s more than 100 million members and Japan Post’s last-mile access to every household and a network of 24,000 post offices, the two will set up counters where people will be able to sign up for Rakuten’s mobile service and make use of its other services. They’ll also collaborate on cashless payments and insurance, the companies said Friday.“When we imagine how this alliance could develop, one possibility is the creation of a super-app connecting the real and online worlds,” Citigroup analysts Koichi Niwa and Mitsunobu Tsuruo wrote in a Monday note. “If the tie-up works well, we expect it to contribute materially to improved competitiveness at Rakuten.”Hooking up with Tencent will offer a window into the vast Chinese internet market and help Rakuten with its efforts to expand its ecosystem to include more gaming, Hiroto Furuhashi, a managing executive officer at Rakuten, said in an interview.(Updates with analyst comment in fifth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Rakuten Inc. plans to raise 242 billion yen ($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.“The alliance will focus on e-commerce first, where having access to Japan Post’s network will be a crucial advantage,” Rakuten Chief Executive Officer Hiroshi Mikitani said at a briefing in Tokyo. “We will also look into partnership in mobile and other businesses.”Rakuten jumped 8.6% to close at 1,245 yen in Tokyo. The shares will be bought for 1,145 yen apiece, according to the filing. Japan Post climbed 4.9%.Rakuten will invest the proceeds into logistics, artificial intelligence and its mobile network. The loss at the company’s wireless unit nearly tripled to 227 billion yen last fiscal year as it spent money to build out its network while offering free service to lure users.The deal brings together Rakuten’s more than 100 million members and Japan Post’s last-mile access to every household and a network of 24,000 post offices, the two companies said in a presentation. The postal group also operates a life insurance business and a bank with about 120 million savings accounts.Win-Win“If Japan Post integrates some of Rakuten’s online services to its huge nationwide network, this can be a reasonably big win for both,” Amir Anvarzadeh, a market strategist at Asymmetric Advisors in Singapore, wrote in a note to clients. “It adds one more reason to own” Rakuten shares, he said.The pair plan to create joint logistics centers and delivery and pick-up systems and will also share data to improve efficiency. Post offices will form counters where people will be able to sign up for Rakuten’s mobile service and make use of other services. They will also collaborate on cashless payments and insurance. Further details of the partnership will be unveiled in April.“We thought long and hard about risk and return before deciding on this investment,” Japan Post CEO Hiroya Masuda said at the briefing. “We believe that going beyond a business arrangement to a capital tie-up will take this partnership to a new level.”Rakuten’s relationship with Walmart dates back at least three years and includes collaboration on fresh produce delivery in Japan and an e-book operation in the U.S. But the connection with Tencent has only been a few months in the making, Hiroto Furuhashi, a managing executive officer at Rakuten, said in an interview after the announcement.One possible area of partnership with the Chinese internet giant is gaming, including tapping Rakuten’s knowledge of the Japanese market to jointly develop titles, Furuhashi said. The Japanese firm, which has almost no presence in China, is exploring opportunities to connect its brand and merchants to Tencent’s WeChat messaging platform to expand its business in the country, he said, adding that nothing concrete has been decided.“We have asked ourselves whether having our online ecosystem without gaming will be good enough,” Furuhashi said. “There is also a huge opportunity for Japanese merchants and our brand in China, including in e-commerce.”(Updates with details of Tencent partnership from 11th paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.