Rakuten To Buy Ebates For $1 Billion In Cash
Company says its global e-Commerce strategy hinges on a marketplace with loyalty programs "at the core".
Japan’s Rakuten Inc. has confirmed it will acquire San Francisco-based Ebates Inc. for roughly $1 billion in cash.
The acquisition will bring 2.5 million new customers to Rakuten, which among other ventures, operates a retail marketplace site in the U.S, Rakuten Shopping. That site was previously known as Buy.com when the company purchased it in 2010.
Founded in 1998, Ebates gives consumers cash back, or rebates, on purchases from more than 1,700 online stores in the U.S. such as Macy’s, Best Buy, Amazon, Walmart and Sephora. The company operates sites in Canada, China, Korea and Russia, encompassing a total of 2,600 stores and online travel agencies. Consumers spent $2.2 billion through Ebates last year.
“Through this acquisition, we aim to jump ahead with our global e-Commerce strategy and lead the global e-Commerce industry,” said Rakuten in the announcement.
Rakuten CEO, Hiroshi Mikitani, said in an interview that he hopes to increase sales outside of Japan to 50 percent of the business, up from 10 percent today, reports the Wall Street Journal. Mikitani say he plans to stand apart from Amazon, eBay and others in the U.S. by focusing on loyalty programs.
Ebates will be integrated into Rakuten’s existing business, “The combination of the two companies will give birth to an attractive and innovative membership-based marketplace for consumers featuring a point program at the core.”