Yahoo Japan acquires majority share in Zozo for $3.7b

Yusaku Maezawa has stepped down from online fashion retailer Zozo that he founded after Yahoo Japan’s proposed acquisition of a majority stake in his company  for US$3.7 billion.

Photo credit: Zozo

Yahoo Japan, a subsidiary of SoftBank Group, said last Thursday it would acquire up to 152.95 million shares or a 50.1% stake in Zozo, representing a 21% premium over the share closing price on Wednesday.

The deal includes an agreement to acquire 92.7 million shares from Maezawa, equivalent to the 30.37% in Zozo.

Maezawa stepped down as Zozo chief executive from Thursday. “I will leave Zozo’s future in the hands of a new president, and I’ll move on to a new path,” he had said in a tweet.

The move is seen by analysts as part of Yahoo Japan’s efforts to strengthen its ecommerce businesses and is expected to help Zozo compete more effectively with rivals such as Amazon Inc. and Rakuten Inc.

Flamboyant Maezawa is the 22nd richest individual in Japan with a fortune valued at around US$2 billion.

Prior to starting Zozo and making a massive fortune for himself, he had defied the norms by skipping college and moving to the United States to join a rock band.

He was in the headlines recently by becoming the first private passenger to book a ticket for Elon Musk’s SpaceX rocket journey to the moon.

Zozo’s business has recently been negatively affected by a series of failed measures, including a custom clothing project that used body-measuring called Zozosuits, polka-dot spandex suits sold to customers with help of smartphones, despite having sold three million pieces.

Shares in Zozo rose as high as 19% following the news, while Yahoo Japan’s briefly increased 5.7%, according to Financial Times.