The market is signaling lingering concern that Rakuten Group isn’t doing enough to reduce debt risk and make its key mobile business profitable, judging by the tepid response to its latest fundraising step.
The Japanese e-commerce firm’s perpetual dollar bonds fell for a ninth day Thursday, following news on Tuesday that Rakuten’s brokerage arm had applied to go public in Tokyo. And the cost to insure its debt against nonpayment using credit-default swaps stayed around record levels, CMA data showed.
Rakuten’s stock has rebounded 2.7% since Tuesday, but declined 0.8% in Tokyo trading Friday. It remains about 26% below this year’s peak in February, despite prospects the group will get more cash via a share sale by unit Rakuten Securities Holdings. The stock has been weak at a time when the Topix index was hitting three-decade highs.
