The IPO of Rakuten Group Inc.'s (4755.T) finance division is scheduled to take place next month and be valued at approximately $800 million. For Rakuten, a big e-commerce company that has battled losses due to the expensive growth of its mobile phone business, the IPO will mark a substantial revenue increase. The offering will also serve as a measure of consumer interest.
According to regulatory documents, Rakuten will offer 53.95 million of the bank's current shares to domestic and foreign buyers while also issuing 5.55 million additional shares. Based on the suggested price's midpoint of 1,795 yen, the IPO is projected to raise 106.8 billion yen ($807 million). The greenshoe option to purchase an additional 4.46 million shares is not included in that sum.
According to Refinitiv, the IPO will be the largest in Japan since the $23 billion offering of SoftBank Group Corp's telco subsidiary SoftBank Corp (9434.T) in December 2018. The shares will be published on the Tokyo exchange's Prime Market on April 21.
The State Of The Market And Rakuten's Finances
While turbulence at Credit Suisse and the failure of several U.S. regional lenders have caused volatility in global bank equities recently, Japanese banks have so far escaped major losses and are seen as resilient enough to withstand the storm. The IPO will put this perspective to the test, as it could be an early sign of Japan's economic health and adaptability to future financial disasters.
Because of Rakuten's recent financial difficulties, the IPO's achievement is critical. The business has made substantial expenditures in a variety of industries in recent years, with varying degrees of success. As a consequence, the cell phone business in the country has never been lucrative. The IPO will replenish the company's funds while also acting as a gauge of the market's belief in the company's long-term viability.
Overview of Rakuten Bank
Rakuten Bank is Japan's largest internet bank, with over 13 million customers as of the end of last year. It is one of many finance companies run by Rakuten with the goal of attracting customers into the network's atmosphere. By utilizing Rakuten's numerous services, including credit cards, purchasing, and insurance, customers can accrue points. You can use these rewards to settle your expenses, get supplies, or reserve vacation.
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