“When considering buying from one state to the whole state”
Naver “Decision based on medium to long term strategy”
On the 9th, Japan’s Softbank publicly announced its intention to buy a stake in Naver, which jointly controls Line Yahoo.
SoftBank CEO Junichi Miyakawa said in the financial statement briefing that day, “At the request of Line Yahoo, we are discussing a capital re-examination from the perspective of security governance and business strategy,” and added, “At this point, no agreement was reached.”
Following Line Yahoo the day before, Softbank also made it official that it has discussed the sale of Line Yahoo shares with Naver.
CEO Miyakawa said, “Our goal is to reach an agreement by July 1,” but added, “It may take time due to the high level of difficulty.” July 1st is the deadline set by Japan’s Ministry of Internal Affairs and Communications to introduce measures in issuing administrative guidelines to Yahoo Line. Japan’s Ministry of Internal Affairs and Communications has requested a ‘re-examination of the relationship between Naver and capital’ through two administrative guidelines following the Line user information leak incident in November last year.
Line Yahoo’s largest shareholder is A Holdings, an intermediate holding company with a 64% stake. Naver and Softbank each own half of A Holdings.
CEO Miyakawa said, “There has been no discussion about how many shares we will buy,” and added, “We are considering buying from one share to the entire company.” He said that Naver responds enthusiastically to discussions, but “there is a difference in the sales amount.”
Naver’s position is, “It’s a matter to be decided based on medium to long-term business strategy.”
Line is a national messenger with approximately 96 million users in Japan. It has also expanded to Thailand, Taiwan, and Indonesia, and has over 200 million users worldwide. If Naver loses its stake in Line Yahoo, its global business strategy will inevitably be disrupted.
Some believe that if Naver sells part of its shares, it will be able to expand its ability to invest in new growth engines such as artificial intelligence (AI). Naver’s stake in Line Yahoo is worth about 8 trillion won. As Naver keeps all possibilities open, there are also comments that it may start selling its shares if it receives a sufficient price.
The Japanese government says the two administrative guidelines are just a request to strengthen security to prevent information leaks from happening again.
However, when you look at the situation as it has developed, it is difficult to accept it as it is. Instead, it is encouraging that the intention is to turn Line Yahoo into a completely Japanese company. On this day, Japan’s Asahi Shimbun reported that some members of the ruling Liberal Democratic Party demanded strict measures against Line Yahoo, saying, “It must be Japanese infrastructure in name and reality.”
Wi Jeong-hyeon, chairman of the ‘Citizens Alliance for IT Equity and Justice’ preparation committee (Dean of Da Vinci Virtual College at Chung-Ang University), said in an online press conference that day, “If we ignore the incident this, we may face the same demands in the future from all countries served by Korean companies.” “Our government must strongly protest and express its opposition to the actions of the Japanese government and the actions of SoftBank,” he said.
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