Line, the Japan-based internet services company owned by Korea-based internet portal Naver, has suspended its initial public offering again, the Wall Street Journal reported yesterday, citing people familiar with the situation.
Spun off from Naver in 2000 as Hangame Japan Corporation, the company began trading as Line Corporation in 2013 after taking the name of its most popular product, instant messaging and calling app Line. It is perhaps best known for its stickers, which revolve around a range of original characters.
Line filed for an IPO on the Tokyo Stock Exchange in July 2014 that would have valued it at about $10bn, according to Reuters, and was considering both a dual listing in the US and Japan, and a US-only listing.
The flotation was subsequently postponed to 2015 but has now been put off again, until at least spring 2016.
Although its messaging service remains popular, with 211 million monthly active users, Line has struggled to successfully diversify its services into areas such as music streaming. Its second quarter revenue was up 39% year on year, according to the WSJ, but down from the first quarter, and the company is still unprofitable.
Another issue is that while it has a sizeable user base in Japan, Taiwan, Thailand, Indonesia, Spain and Latin America, Line has yet to breach larger markets such as China or the US where established competitors such as WhatsApp or WeChat are too firmly entrenched.
Recent market uncertainty in China has also spread to the US, making public listings less tenable, though neither Line nor Naver have released a definitive statement on its IPO plans.
A spokeswoman from Line told the WSJ: “As you know, the global market is currently unstable and we cannot talk about anything definite regarding the timing of a Line IPO.
“Regarding future prospects, we will make a decision based on market conditions and the evolution of our business performance.”
– Image courtesy of Line Corporation