TOKYO--(BUSINESS WIRE)--LINE Corporation (NYSE:LN) (TOKYO:3938) (Headquarters: Shinjuku-ku, Tokyo, Japan; Representative Director and CEO: Takeshi Idezawa; the “Company”) announced that the Company has decided at the board of directors meeting held today to establish a new subsidiary, LINE Friends Japan Corporation (the “New Company”), by a simplified incorporation-type company split (“the Split”) to succeed the Company’s LINE Friends Store business.
Since this is a simplified incorporation-type company split solely involving the Company, certain information is omitted from this announcement.
1. Purpose of the Company Split
As part of the LINE Group, the LINE Friends Store business has been operating LINE brand promotion and character marketing using the Company’s internally developed characters (the rabbit Cony, the bear Brown and other “LINE characters”), with the goal of further expanding LINE’s user platform.
To further streamline the operation structure of the LINE Friends Store business, the Company has decided to convert the business into a wholly owned subsidiary by means of a company split. The Company aims to improve the corporate value of the entire LINE Group by clarifying management responsibilities and promote faster decision making.
2. Summary of the Company Split
(1) Company Split Schedule
Date of approval of the incorporation-type company split plan: July 26, 2017
Date of the Company Split: September 1, 2017 (scheduled)
Note: The Split will be performed without the approval of the approval of the general shareholders’ meeting as it fulfills the requirements for a simplified split per Article 805 of the Companies Act.
(2) Method of the Company Split
The method of the contemplated company split is a simplified incorporation-type company split, with the Company as the company to be split and the New Company as the newly established company.
(3) Allotment of Shares Related to the Company Split
The New Company will issue 2,000 shares of common stock to the Company upon completion of the Split.
(4) Treatment of Stock Acquisition Rights and Bonds with Stock Acquisition Rights of the splitting company
There will be no changes to the treatment of stock acquisition rights issued by the Company upon the completion of the Split.
(5) Increase or decrease of share capital upon the Company Split
There will be no increase or decrease of share capital of the Company upon the completion of the Split.
(6) Rights and Obligations to be Succeeded to the New Company
The New Company will succeed to certain rights and obligations for assets, liabilities, and contractual commitments pertaining to the LINE Friends Store business.
(7) Expectation of the fulfillment of the Company's Obligations
The Company and New Company expect that there will be no issues as to the certainty of fulfilling their respective obligations upon the completion of the Split.
3. Outline of Companies Involved in the Company Split
(as of June 30, 2017)
Formed and Successor Company
(Planning to be established September 1, 2017)
|(1) Name||LINE Corporation||LINE Friends Japan Corporation|
|(2) Location||4-1-6 Shinjuku, Shinjuku-ku Tokyo||4-1-6 Shinjuku, Shinjuku-ku Tokyo|
|(3) Name and title of representative||Takeshi Idezawa, Representative Director and CEO||Seong Hoon Kim, Representative Director and CEO|
|(4) Business||Development of LINE business and portal business via the LINE mobile messaging app||Manufacturing and sales of official goods using LINE characters, etc.|
|(5) Total capitalization||79,919 million yen||100 million yen (scheduled)|
|(6) Date of establishment||September 4, 2000||September 1, 2017 (scheduled)|
|(7) Total number of issued shares||219,407,000 shares||2,000 shares (scheduled)|
|(8) Fiscal year end||December 31||December 31|
|(9) Major shareholders and ownership percentage||
NAVER Corporation: 79.76%
Moxley & Co. LLC: 4.49%
CBHK - Korea Securities Depository - Samsung: 0.96%
|LINE Corporation: 100%|
|(10) Operating results and financial position of company subject to split for the latest fiscal year (consolidated) (Unless otherwise specified, the table is shown in units of million yen)||Fiscal year||December 2016|
|Net assets attributable to owners of the parent||160,834|
|Net assets per share (yen)||738.53|
|Profit before income taxes||17,990|
|Profit for the year attributable to owners of the parent||6,763|
|Basic profit per share (yen)||34.84|
Note: Consolidated financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”).
(11) Outline of Business Division to be Split
(1)Business of Division to be Split
Manufacturing and sales of official goods using LINE Characters, etc.
(2) Operating Results of Business Division to be Split
Revenue for the year ended December 2016: 1,130,067 thousand yen
(3) Items and Book Values of Assets and Liabilities to be Split (As of June 30, 2017)
|Item||Book value (thousand yen)||Item||Book value (thousand yen)|
|Current assets||1,275,882||Current liabilities||112,857|
|Fixed assets||211,928||Fixed liabilities||0|
Note: Final figures for the assets/liabilities to be split will be determined by adjustment of increases and decreases accrued up to the effective date of the Split.
4. Status after the Company Split
There will be no changes to the Company’s name, location, name and title of representative, business, capital and fiscal year-end upon the completion of the Split.
5. Future Outlook
No impact on the Company's consolidated financial results for the fiscal year ending December 31, 2017 is anticipated as a result of the completion of the Split.
This is an English translation of the original Japanese-language document. Should there be any inconsistency between the translation and the original Japanese text, the latter shall prevail.