Yahoo Japan buys CyberAgent’s FX unit as mobile trading takes off

By:
Hamish Risk
Published on:

Yahoo Japan Corp., owner of the nation’s largest Web portal, acquired CyberAgent Inc.’s foreign- exchange unit for 21 billion yen ($254 million) to take advantage of the growing market for mobile FX trading on smart phones

Yahoo Japan, 35 percent owned by billionaire Masayoshi Son’s Softbank Corp., signed the agreement today with completion of the deal slated for Jan. 31, the company said in a statement to the Tokyo Stock Exchange yesterday.

The most striking point of the acquisition is that Yahoo chose to only acquire CyberAgent’s retail FX unit, and not the entire company, which also includes numerous forms of social media, gaming and mobile developments. Analysts say that this is part of a growing trend which will see more technology companies looking to gain a presence in growing retail trends such as online retail FX trading, which is becoming more ubiquitous on smart phones.

"This may mark the start of major firms (i.e., Google, Microsoft, Yahoo, Amazon, Apple) moving toward monetizing their considerable web traffic beyond just advertising by offering features that relate to emerging retail trends [such as retail FX investing]," says Javier Paz, a retail FX analyst at the research firm, Aite Group.

CyberAgent FX was formed in September 2003 and held 9.1 billion yen of net assets as of March 31, according to the statement. The company has continually grown its revenues and profits over the past three-years despite contracting margins. In 2012 in particular, the broker achieved 37% net income growth on a 20% increase in sales, according to data released by the two companies.

CyberAgent operates the Ameba blogging service.

Unlike inside the US, where Google has a commanding lead in search, Yahoo Japan has the leading portal in Japan for around 10 years. Analysts argue that this is part of Yahoo Japan’s attempt to incorporate more smart phone based transactions within the daily actions of consumers who use the Softbank service with the Yahoo portal.

Furthermore, as well as adding a new and well financed player to the Japanese retail FX market, the incumbent brokers will also have to compete with Yahoo Japan’s emphasis on changing the landscape of trading from the desktop to the smart phone.