Japan’s Rakuten Group has tapped Goldman Sachs and Daiwa Securities to oversee an initial public offering (IPO) for its banking unit.
That’s according to a Wednesday (Sept. 21) report by Bloomberg News, citing sources familiar with the matter.
The sources say Rakuten — whose businesses include eCommerce, messaging, food delivery and a variety of FinTech services — plans to list its banking operations on the Tokyo Stock Exchange with a valuation of about 300 billion yen ($2.1 billion) to 400 billion yen in an IPO as early as December.
Goldman Sachs declined to comment Wednesday; a Rakuten spokesperson also declined to comment.
The Bloomberg report noted that the IPO is part of an effort by the company to expand its financial services operations as its mobile unit struggles and it faces tough competition from Amazon for Japan’s eCommerce market.
“It makes sense for Rakuten to raise money to help the banking unit grow further — the combination of its eCommerce operations and FinTech makes the company a strong, attractive player in Japan,” Morningstar analyst Kazunori Ito told Bloomberg.
The planned IPO is happening amid a lengthy drought for tech IPOs in the U.S., as PYMNTS reported recently.
Wednesday marks the 238th day without a tech IPO of over $50 million, surpassing the records set in the wake of the 2008 financial meltdown and the early oughts dot.com bust.
Learn more: US 8-Month Tech IPO Drought Is Longest in This Century
High inflation has led the Federal Reserve to boost interest rates, weakening enthusiasm for growth stocks that soared during last year’s boom.
And while tech startups have been hit hardest, it’s not just tech. Overall U.S. IPO volumes have fallen down 94% year-over-year, with just $7 billion raised by earlier this week compared to $110 billion at this time last year.
In April, Rakuten Group launched a collaboration with Uber Eats in Japan to give users another online payment option.
Read more: Rakuten Teams With Uber Eats Japan for Digital Payments
Rakuten Pay, the Rakuten Group’s online payment operation, processes payments through the credit card linked to the Rakuten ID system. It also enables users to earn Rakuten Points when ordering through Uber Eats and pay for orders with those earned points.