Japan’s Line to raise as much as $1bn in IPO

Tokyo / Bloomberg

Line Corp. is aiming to raise as much as ¥113 billion ($1 billion) in an initial public offering (IPO) in July, putting it on track to deliver the biggest market debut for a technology company this year.
The sale of new and existing shares, in the US and Japan, values Japan’s most popular mobile-messaging service at ¥588 billion, according to data from a filing. The offering is for 35 million shares, with an over-allotment of 5.25 million shares. The price range will be set on 27 June, and the final price on 11 July, the company said.
The Tokyo-based company, owned by South Korean search portal Naver Corp., is planning a long-term expansion in the US Line, whose app debuted in 2011, pioneered the business model of selling stickers and other digital knickknacks for people to buy and share during chat sessions on their mobile phones. The funding will give Line, with 218 million monthly active users, more resources to challenge Facebook Inc.’s Messenger and WhatsApp, or China’s WeChat. The shares will list in New York on 14 July, and 15 July in Tokyo.
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. No business has raised more than $150 million in a technology listing in 2016, even though more than 160 private startups are currently valued at $1 billion or more.

IPO fruition
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 US, seeking to raise funds via a dual listing in Tokyo and New York, people with knowledge of the matter said at the time. The company decided not to hold a public offering, and also passed on it again last year.
The company was valued at ¥1 trillion when it first filed for an offering in 2014, people familiar with the situation said at the time. It will now debut with a market value of roughly ¥588 billion based on Bloomberg’s calculations, emphasizing its profitability and popularity in markets where it leads.
While Line is No. 1 in Japan, Thailand and Taiwan, chief executive officer Takeshi Idezawa, 43, is betting that the messaging service will be able to snap up users in the Middle East, tapping into a pool of more than 1 billion people in regions where there isn’t a dominant messaging service.
Of the total share sale, 13 million will be offered in Japan and the remainder overseas. Nomura Holdings Inc., JPMorgan Chase and Co., Morgan Stanley and Goldman Sachs Group Inc. are the lead underwriters.