Japanese Online Retailer Buys US Internet Marketer

07 September 2005

Internet marketing agency Linkshare has become the first US purchase by the Japanese online retailer Rakuten.

The $425 million (£230.49m; €340.71m) deal - Rakuten's largest ever - is for the world's leading agency in affiliate marketing, a rapidly growing sector in which sales links are placed on individual websites and blogs ('affiliates'), whose owners get commission on resulting trade.

Linkshare's role as a broker providing companies and affiliates with a network of potential tie-ups led to an operating profit of $10 million last year, from commission-driven sales revenues of $32m.

Some Tokyo entrail-rakers, however, expressed caution. KBC analyst Hisoshi Kamide said: "It doesn't really help them to go overseas because it doesn't help the domestic business, which is what it's all about." He also called Rakuten "an M&A machine".

Data sourced from Financial Times online; additional content by WARC staff