As part of the acquisition, Zozo founder Yusaku Maezawa has agreed to sell a stake of around 30%, leaving him with about 6% and will further step down as chief executive of the retailer.
However, Maezawa will continue to participate in Zozo events, and will be referred to as the company's founder. He further plans to pursue personal interests, such as becoming the first tourist to fly around the moon in Elon Musk's SpaceX program.
The company statement claimed that the deal would generate synergy as it looks to benefit from Yahoo Japan's PayPay online shopping mall set to launch later this year.
The takeover news comes after Rakuten's plans of launching a wireless telecom service in a direct challenge to SoftBank’s cash-cow business and Amazon's aggressive push into fashion.