Japanese Billionaire Acquires Viber for $900 Million

Rakuten Ichiba, a Tokyo-based online shopping company owned by billionaire Hiroshi Mikitani, has acquired the instant messaging and calling service Viber.

The acquisition price is said to be for $900 million and this deal is made by Rakuten to help them penetrate the social marketing sphere more effectively.

The Japanese company plans to use Viber as a distributor for its online products and will also aid them in establishing a game platform. The deal is supposed to help Rakuten compete with similar companies such as Line by Nave Corp and WeChat by Tencent Holdings Ltd. Both services put together instant messaging, shopping, and gaming and this is what Rakuten is envisioning to do with Viber.

"Viber understands how people actually want to engage and have built the only service that truly delivers on all fronts," Mikitani said in a statement to Businessweek. "This makes Viber the ideal total consumer engagement platform for Rakuten."

The acquisition will be paid for through bank loans and is predicted to be finalized by March this year.

"As smartphones become a more important communication tool than personal computers, Rakuten needs to find a way to link smartphones to its businesses," stated chief fund manager of Shinkin Asset Management Co., Naoki Fujiwara to Businessweek. "This deal is probably aimed at linking the two.", she added.

Viber has 300 million users as of 2013 and Rakuten's acquisition of the company will help them boost their sales for the coming year. Rakuten also bought stakes from social networking site Pinterest Inc., and Kobo. Inc, a digital book seller.In 2013, it also acquired Viki.Inc, a digital content platform and in 2012, they bought Wuaki.tv, a video-on-demand streaming service based in Europe.

Rakuten Ichiba is more popularly known for their online services which connect buyers and merchants who are looking for electronics, clothing, toys, and other Japanese goods. As of last year, the company has a 27.7 share in Japan's online retail market, as reflected on the data made by Euromonitor International.