Rakuten Group, the debt-laden online retailer, said it will consider combining its financial units to promote collaboration.
The conglomerate will examine whether to put its banking, securities, credit card and insurance businesses into a single group within the company, it said in a statement on Monday.
Shares of Rakuten and its banking arm rose after the announcement spurred optimism over the prospects for the group's fintech business. Billionaire Hiroshi Mikitani’s company is grappling with debts that mounted during an unprofitable foray into the mobile phone carrier business.
A proposed initial public offering of its securities unit may not proceed if the integration is realized, while the banking arm is expected to remain listed after the reorganization, it said.
The move "is equivalent to a back-door listing of its securities and card businesses via Rakuten Bank,” Bloomberg Intelligence analysts Marvin Lo and Chris Muckensturm wrote in a note. "This could lead to greater synergies and boost the combined value of the three units toward the high end of our estimates, at about ¥1 trillion.”
Rakuten Group climbed 3% at the close of trading in Tokyo, while its banking unit jumped 3.6% to the highest since it was listed a year ago.
Rakuten last year shelved plans to list its brokerage arm, with Japanese bank Mizuho Financial Group instead raising its stake in the unit.
The parent company has about ¥700 billion ($4.6 billion) in bonds due in 2024 and 2025, after posting losses for five straight fiscal years.
Meanwhile, Rakuten Bank has been increasing customers thanks to the group’s reward point system designed to lock in users. It raised its annual profit forecast earlier this year.