14 DAY TRIAL // Kobo, a company well known for its eReaders and eBook services, has just announced that it has entered into a definitive agreement with Japan-based Rakuten, which intends to acquire 100% of Kobo's issued and outstanding shares.
The transaction will bring Kobo $315 million (231.08 million EUR) in cash from the Japanes e-commerce company.
Kobo was founded by and spun out of Canadian retailer Indigo in late 2009, and during its recent history the company has struggled to compete against the likes of Amazon and Barnes & Noble in the eBook space.
Its best known product is the Kobo eReader that has reached its third generation in May of this year.
With the purchase of Kobo, Rakuten wants to expand its e-commerce business globally, by adding an ecosystem to provide downloadable media products to consumers, starting with eBooks.
“From a business and cultural perspective this is a perfect match,” commented Kobo CEO Michael Serbinis.
“We share a common vision of creating a content experience that is both global and social. Rakuten is already one of the world’s largest e-commerce platforms, while Kobo is the most social eBook service on the market and one of the world’s largest eBook stores with over 2.5 million titles.
“This transaction will greatly strengthen our position in our current markets and allow us to diversify quickly into other countries and e-commerce categories,” concluded the company's rep.
The transaction is subject to customary closing conditions, including approval by Canadian regulatory authorities, and is expected to close in Q1 2012.
Upon closing the acquisition, Kobo will continue to maintain its headquarters, management team and employees based in Toronto, Ontario.
The global eBook market is one of the fastest growing segments of the consumer technology industry, with a compound annual growth rate of 36% through 2015.