Singapore-based video streaming platform Viki is set to be purchased by a Japanese internet giant in what is believed to be the biggest acquitision of a local start-up in recent history.

Viki's chief executive and co-founder, Razmig Hovaghimian, confirmed the acquisition by Rakuten, a Japanese e-commerce giant, although he declined to give a price for the purchase. Sources with knowledge of the situation said the deal is worth US$200 million (S$255 million), US tech website AllThingsD reported.

Rakuten is best known for its Kobo e-book service which it acquired last year.

"There are a striking number of synergies and shared philosophies between our two businesses; the Viki model is built on a powerful community, focused on removing the language barriers that have traditionally trapped great content inside geographical borders," said Rakuten's chief executive, Hiroshi Mikitani, in a statement.

"Rakuten's focus too has been to open up great services, content and goods to a global community. Viki is a perfect complement to Rakuten's joint philosophies of empowerment and shopping is entertainment," he added.

Viki's technology operates in the same way as Wikipedia's, with users translating dialogue into more than 150 languages.

That means viewers can watch a Korean movie such as My Wife Is A Gangster 3 with English or Thai subtitles - depending on whether the volunteers have finished their work.