Rakuten buy UK e-commerce site Play.com

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Rakuten have announced today that they plan to acquire a footing in the UK with a definitive agreement to acquire UK e-commerce site Play.com for approximately 25 million pounds sterling in cash.

The acquisition represents a significant step in Rakuten’s continued European and Global expansion and marks the company’s third acquisition in Europe, joining French e-commerce pioneer PriceMinister, acquired in 2010, and the rapidly expanding German online shopping mall, Tradoria, which joined the Rakuten Group in July of this year.

“The UK market is one of Europe’s largest and most mature e-commerce markets. Play.com is not only a pioneer in the market, but also one of the UK’s most successful e-commerce businesses. We aim to leverage our e-commerce strength and experience to further expand and develop Play.com’s business model and channel its loyal user base, merchants, and deep product offerings into Rakuten’s global e-commerce network.”
– Hiroshi Mikitani, Chairman and CEO of Rakuten

This has the potential to upset the incumbents – eBay and Amazon – as Rakuten plans are for long term UK investment. Back in May this year Rakuten announced their intention to invest in the UK and Germany and with the acquisition of Play.com they now have a large UK buyer community of 7 million registered users, with 8 million listed products on the site.

Play.com is one of the UK’s largest online retailers, selling a wide range of goods, from music and books to electronics, clothing, and accessories. Founded in 1998 and head-quartered in Jersey, British Isles, the company has grown to employ approximately 500 dedicated staff.

Play.com still has a perception, similar to Amazon a few years ago, that it’s largely a platform for media – CDs, DVDs and computer games. With the investment of Rakuten behind them expect marketing efforts to ramp up to let customers know that they also sell Clothing, Sporting Goods, Computing, Mobile, and of course especially important in the run up to Christmas – Toys.

Do you already sell on Play.com and if not would you consider it now that it’s a Rakuten company? If you’re a developer of 3rd Party multichannel seller tools do you already support Play.com and if not will you be building in support in the future?

14 Responses

  1. Play are already the only real credible competitor to eBay and amazon in the UK- this investment will hopefully strengthen their position further and help increase competition in UK.
    And yes, our sellerexpress software supports play.com.

  2. Since when have Play.com been a “UK” company, I can’t find an entry for them at Company House.

    Agrees with Whirly, 25 million does sound cheap. One has to wonder just how well they were doing behind the scenes.

  3. I wonder if someone near the top of Play.com was worried about the Channel Islands VAT loophole closing? It would make sense to sell quickly before one of their key market advantages disappears.

  4. The value of Play.com is not too far away from the fag packet valuation offered by http://www.worthofweb.com

    ebay.co.uk is worth $175m

    ebay.com is worth $841m

    ebay.de is worth $185m

    amazon.com is worth $1182m

    amazon.co.uk is worth $151m

    As for the value of my website…. 🙂

  5. Just checked TameBay. Their traffic figures for visits are out by a fair margin.

    However it does say In addition, the estimated worth above is for website only. You need to add the brand value to this website worth to determine the price tag.

  6. Reminds me of the valuations circulating before the dot com bubble burst a few years ago. There were companies who had as their main assets a couple of PC’s, that operated out of a front room and had never traded or made a profit yet were “valued” at £millions.

    Valueing a business, any business, is always difficult. Over the years many businesses have been bought by competitors after having full access to the books, having had their people go over the business in great detail, having had outside experts check everything. Yet 12 months down the line they have found that in reality the business was not worth a hill of beans.

    £25million does sound very cheap but probably because we are all used to crazy prices being quoted elsewhere. Perhaps £25million is in reality a fair and accurate price. After all both the buyer and the seller must be happy with it. If one or other of them were not happy the deal would not have happened.

  7. i used order to order all my media through play but now order nothing as their delivery times were geting slower and slower. I think it is probably something to do with AN post and i also noticed they now use 2nd class logo on their packages (used to be 1st). pre-ordering video games is a nightmare. Last 3 pre-orders i did with them, not one of them arrived on the release date of the game. all 3 were deliveered at least a week after the official release date. That was the final straw for me


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