SoftBank Corp-controlled Yahoo! Japan has agreed to merge with messaging app operator Line Corp, owned by South Korean internet giant Naver, to create a USD30 billion tech giant that could help the Japanese conglomerate expand its e-commerce and payments services capabilities. In a joint announcement today (18 November) Naver and SoftBank said the merger will go ahead in a deal that is set to create the largest Japanese mobile platform. The two parent groups will each hold 50% stakes in the merged entity – Naver currently owns more than 60% of Line’s shares, while SoftBank has more than 40% in Z Holdings, which controls Yahoo! Japan.
The two parties will sign a definitive contract in December and complete the deal by October 2020, Line said in a statement. To complete the merger, Line is expected to go private by acquiring all outstanding shares, options and convertible bonds. Further, the messenger app will offer JPY5,200 (USD47.7) per share, which is 13.4% premium on the closing price of common shares on 13 November 2019. Going forward, the joint venture (JV) will control Z Holdings, which in turn will operate Line and Yahoo! Japan, with the former becoming a consolidated subsidiary of SoftBank, which is itself a unit of holding conglomerate SoftBank Group Corp.