Line management has refiled the paperwork necessary to make an initial public offering in the Tokyo Stock Exchange. This does not mean, however, that the IPO will take place this year.
A Line rep pointed out that “so far there is no decision regarding an IPO. No more comments on that”.
Line, which is being developed by the Naver Internet giant, postponed an IPO it had planned last year, choosing to focus on rolling out internationally instead. The paperwork for the previous IPO became irrelevant on March 31, on the day when the Japan’s fiscal year was over. Therefore, the Line’s refiling for an IPO is likely to mean that Line does not eliminate a possibility of a listing; however, the company does not have clear plans regarding it yet.
In his recent interview, the new Line Corporation CEO, Takeshi Idezava, said that Line plans to increase its expansion before it finally goes ahead with an IPO. It is important for the company, since its popularity is limited by its top positions in Japan, Taiwan, and Thailand only. So, there is still a lot of work to be done for the app to become number one in other countries.
Besides, the recent financial statements show a decrease in profits from the major source, which is Line’s gaming business. This means that when working on foreign markets, the company has to take advantage of extra income sources, including mobile payment service, streaming audio and video services and online-offline services like cab calling.
By striving to gain a share in foreign markets and postponing an IPO Line could end up getting itself in a tight corner, since the raised funds could ensure that the roll out would be performed fast with all of its goals achieved. Therefore, it seems logical that the company retains this opportunity and renews the necessary paperwork, despite the fact that the final decision has not been made yet.