Despite the ongoing diplomatic dispute, many experts anticipate that Naver will sell its stake in the joint venture with SoftBank, which controls the Line messenger app and Yahoo Japan. The crucial question revolves around the amount of cash Naver could generate from the stake sale and its potential impact on future business operations. Naver and SoftBank each own 50 percent of A Holdings, which holds nearly 65 percent of LY Corp., the merged entity of Line and Yahoo Japan. The estimated market cap of LY Corp. is around $18 billion, making Naver's stake worth approximately $6 billion. Industry insiders had already anticipated Naver gradually reducing its ownership in Line to strengthen ties with SoftBank, but a cybersecurity breach and external pressure have complicated this transition. The company now faces a challenging choice between securing cash and relinquishing its foothold in other Asian markets that Line provides. With Naver's market capitalization at about $20 billion, a potential stake sale could provide cash for its growing artificial intelligence business. However, it appears inevitable that Naver will lose its influence in Southeast Asia, where Line has amassed over 200 million users since its 2011 launch. The potential stake sale has also raised concerns about the job security of Line workers and the impact on Naver's global expansion strategy. Line Plus, a subsidiary mainly operating in Southeast Asia, reported significant sales in Japan, further complicating the potential consequences of the stake sale. If the stake sale materializes, Naver may have to reevaluate its global expansion strategy, potentially causing a decline in net profit and impacting its workforce. The situation highlights the intricate balance Naver must navigate between financial considerations and maintaining its presence in key Asian markets.
Despite the ongoing diplomatic dispute, many experts anticipate that Naver will sell its stake in the joint venture with SoftBank, which controls the Line messenger app and Yahoo Japan. The crucial question revolves around the amount of cash Naver could generate from the stake sale and its potential impact on future business operations. Naver and SoftBank each own 50 percent of A Holdings, which holds nearly 65 percent of LY Corp., the merged entity of Line and Yahoo Japan. The estimated market cap of LY Corp. is around $18 billion, making Naver's stake worth approximately $6 billion. Industry insiders had already anticipated Naver gradually reducing its ownership in Line to strengthen ties with SoftBank, but a cybersecurity breach and external pressure have complicated this transition. The company now faces a challenging choice between securing cash and relinquishing its foothold in other Asian markets that Line provides. With Naver's market capitalization at about $20 billion, a potential stake sale could provide cash for its growing artificial intelligence business. However, it appears inevitable that Naver will lose its influence in Southeast Asia, where Line has amassed over 200 million users since its 2011 launch. The potential stake sale has also raised concerns about the job security of Line workers and the impact on Naver's global expansion strategy. Line Plus, a subsidiary mainly operating in Southeast Asia, reported significant sales in Japan, further complicating the potential consequences of the stake sale. If the stake sale materializes, Naver may have to reevaluate its global expansion strategy, potentially causing a decline in net profit and impacting its workforce. The situation highlights the intricate balance Naver must navigate between financial considerations and maintaining its presence in key Asian markets.