Japanese mobile internet venture sells off overseas businesses at a significant loss February 28, 2007Posted by fukumimi in Economy & Business, Internet, IPO.
For-Side.com, originally one of the big Japanese mobile content providers (ie ringtone merchants – though they have branched out into other things like content (music, video) creation and distribution) has announced that it is selling its overseas operations which operate under the iTouch group banner to concentrate on domestic activities.
It had purchased the iTouch operations (which previously was a member of the FTSE 100 Techmark index) in May 2005 for 184million pounds in cash……..
The company is being sold to a group led by the ex-CEO of iTouch for 7.6B Yen, which today is about 33million pounds.
I don’t think I need to bother commenting any further….
The company had grown through an acquisition strategy, which clearly hasn’t worked.
Shares were trading (on Jasdaq) at JPY6670, off nearly 80% compared its 52-week high of JPY32,300. It had traded at over JPY200,000 back in the middle of 2004.
To end this post, I’ll leave you with Reuter’s one line comment about this company:
Rapidly selling its acquisitions. Mobile contents business minimal. If overseas businesses are sold, what remains is basically just a consumer loans business.
And this is the state isn’t unique for a listed Japanese “internet” company. Like Livedoor before it, this company probably doesn’t deserve to be called an internet company, if that definition is to have any meaning. Consumer loans (read: legalised loan sharking at up to 28% APR) and an M&A vehicle seems to be the right characterisation of this company.
And another example of a failed attempt by an young Japanese company to expand overseas. Hint: You need a real business to succeed….