Naver says exploring all options including stake sale in Line operator

LY

10/05/2024 06:56

SEOUL, May 10 (Reuters) - South Korea's Naver
 035420.KS  said on Friday it is exploring various options
including the potential sale of its stake in the company that
controls LY Corp  4689.T  which operates the popular messaging
app Line.
    In a statement, Naver, which holds an equal stake with
SoftBank  9434.T  in a joint venture that controls LY Corp,
apologised for the recent security breach that led the Japanese
government to issue an administrative guidance. 
    "Naver will continue to put top priority on Naver
shareholders and on raising the corporate value of Naver and
LINE Yahoo as its major shareholder and partner as we make
important decisions," it said in a statement.
    "Related to the issue at hand, we are negotiating with
SoftBank in good faith and open to all possibilities including
the sale of our stake to achieve the best outcome for the
company," it said.
    LY Corp admitted in November last year that there had been
unauthorised access of its systems by a third party via Naver's
cloud system. This led to the leak of the personal data records
of more than 300,000 Line users and others.
    Although the guidance from Japan's internal affairs and
communications ministry about the data leak did not explicitly
mention a sell-down, it did direct LY Corp to "review the
relationship where the outsourced company has a significant
degree of capital control", referring to Naver.
    Since the move by the Japanese government, Naver and the
South Korean government have faced domestic criticism for not
taking a more proactive stance to protect Naver's interest in LY
Corp.
    LY Corp said on its website that more than 95 million
monthly active users used Line in Japan as of March last year,
and it had another 83 million users in Thailand, Taiwan, and
Indonesia. Line was launched in 2011.

 (Reporting by Jack Kim
Editing by Ed Davies)
 ((jack.kim@thomsonreuters.com; +822 6936 1455;))