Rakuten pays $410 million for U.S. e-book marketplace OverDrive
March 19, 2015 11:23 AM
(Bloomberg) -- Rakuten Inc., operator of Japan’s biggest Internet shopping mall, will pay $410 million in cash for e-book distributor OverDrive Inc. to expand its digital content business.
OverDrive will strengthen Rakuten’s e-book business by adding a distribution platform, more than 2.5 million titles, relationships with 5,000 publishers and 30,000 libraries, Rakuten said in a statement.
Rakuten has spent about $3.2 billion over the past three years to buy companies as it expands into online services and selling e-books, video and other content. The company said earlier this month it would invest $530 million into Lyft Inc. and paid $981 million in cash for Ebates Inc. in October, after acquiring Viber Media Ltd. last March for $905 million.
Rakuten’s billionaire chairman Hiroshi Mikitani has introduced tablets in Japan to help sell e-books, tracking rival Amazon.com Inc.’s strategy of delivering digital content through its Kindle platform. Mikitani is Japan’s third-richest man with a net worth of about $9.8 billion according to the Bloomberg Billionaires Index.
OverDrive supplies the industry’s largest catalog of e- books, audiobooks, music and streaming video to 33,000 libraries, schools and retailers worldwide, according to a statement from the Cleveland, Ohio-based company. It will operate under current chief executive officer Steve Potash as a subsidiary of Rakuten’s U.S. unit, according to the statement.
As of Dec. 31, Rakuten had about 1.2 trillion yen ($9.9 billion) in net cash, according to data compiled by Bloomberg.
Rakuten.com Shopping is No. 46 in the Internet Retailer 2014 Top 500 Guide, while Rakuten Inc. is No. 20 in the Internet Retailer 2015 Asia 500. Amazon.com is No. 1 in the Top 500.