The move doesn’t come as a major surprise – the company was a leading contender to go public, with rumors recently surfacing that a dual IPO in NY and Tokyo was in the works. But the majority of those users exist across Japan and a handful of Asian countries. It has also expanded its services by including music streaming and hailing taxis.
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Line is looking to raise funds to expand into the United States and help it compete with rivals such as Facebook Messenger, WhatsApp and China’s WeChat.
Plans to take Line public stretch back to 2014, when it submitted an application for an IPO to the Tokyo Stock Exchange, and also filed confidentially for an IPO in the USA, seeking to raise funds via a dual listing in Tokyo and NY, people with knowledge of the matter said at the time.
So why the dual IPO?
The proceeds from the initial public offering will be used to acquiring new companies and other strategies for global expansion.
Line, which is a subsidiary of South Korea’s Naver Corp., said it had 218 million monthly users at the end of March.
The IPO would be this year’s biggest tech offering globally, according to data compiled by Bloomberg, providing a rare bright spot for the moribund market for listings. This will be the first simultaneous IPOs by a Japanese company involving the NYSE. “The dual-listing in the USA and their home-market could help Line to strengthen their brand, particularly in the States, but it would still be a tough race with the existing players there”. The number of LINE’s monthly active users came to 220 million as of March this year.
It boasts the most users among messaging apps in Japan, but the only other markets it leads are Taiwan, Thailand and Turkmenistan, showed data last month from researcher SimilarWeb. With its market capitalization estimated to reach roughly 600 billion yen ($5.6 billion), LINE’s IPO would be bigger than any technology stock offers made in the U.S. Japan, or any parts of the world so far this year. Another 22 million new shares are expected to be offered in NY.
Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management Co., said once listed he expects Line’s share price to hover at around the indicative price, considering the general lack of excitement in the market.
It will be the biggest in Tokyo since Japan Post made its trading debut in November 2015 worth $11.5 billion.
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Juro Osawa in Hong Kong contributed to this article.
