SoftBank and Line Corp. Seek to Create a Japanese Internet Giant

TOKYO — Two weeks ago, SoftBank Group of Japan announced it had lost billions on soured investments in some of the world’s biggest tech start-ups. On Monday, it said it was ready to roll the dice again.

The company announced an agreement to merge its subsidiary, Yahoo Japan, with Line, a dominant messaging app company, to create a Japanese internet goliath that would be able to compete against bigger and better-financed tech firms in the United States and China.

SoftBank and Naver, the South Korean company that owns a majority stake in Line, said Monday they had reached a memorandum of understanding to take the messaging company private as the first step in a complex financial arrangement that would result in Yahoo Japan and Line being held by Z Holdings, the publicly listed company that currently operates Yahoo Japan.

The combination would bring together two prominent companies in Japan that have seen better days. Yahoo Japan, formed in 1996 as a joint venture with Yahoo, offers a range of services including online shopping and news, but has struggled to make the move from desktops to mobile phones.

Source: The New York Times

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