By Sam Nussey and Chang-Ran Kim

TOKYO (Reuters) – Shares in Rakuten Group Inc fell 6% early on Tuesday, extending the previous day’s sharp slide after Reuters reported the company would issue new shares to shore up its finances after years of losses from its mobile business.

The Japanese e-commerce and fintech company‘s board could meet as early as this week to decide on the capital raising, which is expected to raise roughly 300 billion yen ($2.2 billion), sources told Reuters on Monday.

Prospects of a share dilution led on Monday to the biggest one-day drop in three years. Rakuten’s market capitalisation has fallen about $1.66 billion since the Reuters report.

“Whenever there is a large sale of new equity, that is dilutive but it also forces decisions about whether to hold. Some will be upset and will sell,” said analyst Travis Lundy of Quiddity Advisors, who publishes on Smartkarma.

Rakuten said in a statement it was not true that any such decision had been made.

Rakuten last week posted a quarterly loss and said it would sell its stake in supermarket chain Seiyu to U.S. private equity firm KKR & Co Inc for 22 billion yen, just three years after agreeing to buy the shares from Walmart Inc.

That followed an initial public offering last month of its banking unit, while the company also plans to list its brokerage arm.

($1 = 135.0500 yen)