Japan's Rakuten set to raise $2.18 billion through share issue

TOKYO (Reuters) -Japanese e-commerce and fintech conglomerate Rakuten Group Inc will raise up to 294.2 billion yen ($2.18 billion) by issuing new shares, it said on Wednesday as it works to offset the financial impact of losses at its mobile business.

Rakuten will issue 407,045,400 new shares with a green shoe option of up to 61,056,700 shares, along with 74,204,700 shares through allocations to founder and CEO Hiroshi Mikitani, his asset management firm, CyberAgent Inc and Tokyu Corp.

Rakuten set the price at 566 yen per share with the offer to launch May 31. The group's shares closed down 2% at 584 yen on Wednesday ahead of the announcement.

Mikitani originally outlined plans to become Japan's fourth major mobile carrier, promising to create a low-cost nationwide network by using cloud-based software and commoditised hardware.

However, the company has spent cash funding the build-out, and analysts have said Rakuten is struggling to take market share from cash-rich incumbents known for high-quality networks.

To raise capital Mikitani has already offloaded stakes in core businesses and moved to float the group's securities and banking units.

($1 = 135.0500 yen)

(Reporting by Mariko Katsumura and Sam Nussey; editing by Jason Neely, Toby Chopra and Barbara Lewis)