Yahoo Japan stated how it would acquire Japan’s largest online fashion firm Zozo Inc. for as much as ¥400 billion ($3.7 billion), adding its own take to the business and helping it in competing more efficiently with larger opponents, such as Amazon Inc., Rakuten Inc., etc.
Yusaku Maezawa, the founder of Zozo stated how he intends to give up his post as a chief executive officer and sell off most of his share following a sequence of slip-ups which cut down its market worth by more than 50% from the high-point the previous year of $14 billion.
These failed initiatives include a custom clothing project that used body-measuring Zozosuits, polka-dot spandex suits the company shipped with help of smartphones. The company managed to sell 3 million of them.
This agreement may help steer Yahoo Japan clients, from being mostly middle-aged or old-aged, to Zozotown, which mostly has a younger following.
Zozo’s departing chief of executive, Maezawa, made a name and fortune for himself by challenging the customs of Japanese culture.
A former musician, Maezawa, teared up while thanking shareholders and employees. He stated how his style style may have been too top-down, and it was the right time to introduce a new chief executive officer.
Yahoo Japan offered ¥2,620 per share, a premium of nearly 21% on Zozo’s closing price, sending its shares rising on Thursday. However, this is 44% lesser than its highest, which was nearly a year ago. On Thursday, shares of Yahoo Japan gained 2% while those of Zozo ended up 13%.
An executive officer with Ichiyoshi Asset Management Co. in Tokyo Mitsushige Akino, said: “Zozo gets the financial back up it needs for its new venture and overseas expansion.”