SoftBank bought a 51 per cent stake in Line Mobile, a subsidiary of Japan-based mobile and internet services company Line, to strengthen the MVNO business.
In a statement, Line said SoftBank is purchasing “a third party allocation of new shares in Line Mobile,” and entering “into a partnership to promote the MVNO business.”
TechCrunch reported the mobile business is valued at around $15 million, but talks about the valuation for SoftBank’s investment are ongoing. The remaining 49 per cent will stay with Line and the deal is expected to be complete by March.
Line said it wants to use SoftBank’s “experience as a comprehensive telecommunications business operator to achieve further growth”.
Ayano Kado will continue to serve as president of Line Mobile, which began operations in September 2016. Line said its MVNO continues to grow steadily, achieving a nearly 1.3-times year-on-year increase in monthly ARPU in December 2017.
TechCrunch reported the market for MVNOs in Japan flourished after the government relaxed regulations around handsets in early 2017.
Line said it tried to set itself apart by giving users unlimited data to access social networks including Line’s messaging app and music service, along with Twitter, Facebook, and Instagram. It said it is “unique in introducing plans that are easy to understand and match the use behaviour and needs of individual users.”
Strengthening the MVNO also plays into Line’s strategy to turn its popular messaging app into a smart portal. It believes by expanding Line Mobile, the company’s services and businesses will grow, which will “promote its smart portal strategy, which aims to make the Line messaging app into a gateway that seamlessly connects people to information and services, as well as to companies and brands.”
Line separately announced the formation of a new business, Line Financial, to reinforce its position in financial services and build on the strength of its Line Pay business.
Earlier this month SoftBank Group brushed aside reports it was preparing to list its mobile unit in Tokyo and overseas, stating it is yet to reach a decision on the move.