Messaging App Line Makes Largest Debut in Tokyo to Date This Year
As the Tokyo-based Line makes its debut in Tokyo and in New York, all eyes will be on whether its messaging app will win over users outside of Asia, where the communication tool has won over the enthusiasm of users more than its American rival WhatsApp.
Line (LN) - Get Report made its debut on the first section of the Tokyo Stock Exchange, closing the day at ¥4,345 ($41.0), up 32% from the offer price of ¥3,300 per share. Based on the closing price, the company was valued at over ¥900 billion ($8.5 billion), making it the largest public offering to date on the TSE this year.
The company, owned by a South Korean Internet company Naver, also made its debut on the New York Stock Exchange yesterday and closed at $41.58. That's up 27% from its initial offering of $32.84 per share, valuing the company at about $9 billion, the largest tech IPO of the year so far. Its American Depositary Shares will trade under ticker code LN.
The company offered 13 million shares in Japan and 22 million shares in New York.
Line has a strong presence in Asia and has grown to become a large part of everyday communication there over the last five years. As it makes its debut in New York, its next challenge will be to attract a wider customer base, competing with giants like social media site Facebook (FB) - Get Report and its messenger app WhatsApp, as well as to develop ways to generate revenue from fee-charging applications.
In Japan, the messaging app has won over half the population, young and old, dwarfing WhatsApp, partly as it offers a wider method of communication than its Californian rival. A large feature of the messaging system is stamps, which are pictures, some of which move, that enable the message sender to convey more emotions than they would just with words. While many of the stamps are offered for free, users can choose to pay for others.
Line had more than 218 million monthly active users at the end of the first quarter of 2016, with the active users mainly in Japan, Taiwan, Thailand and Indonesia. This compares with 1.65 billion for Facebook. In addition to instant messaging and voice call functions similar to Whatsapp, Line offers interactive social media function similar to Facebook, as well as games.
For the year ended December 2015, the company booked net loss of more than ¥750 million on revenue of ¥121 million. In 2015, revenue grew nearly 40%, while bottom line tumbled to a loss from a profit in the previous year.
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