SoftBank Corp. (TSE:9434) and NAVER Corporation (KOSE:A035420) entered into a letter of intent to acquire the remaining 28.7% stake in LINE Corporation (TSE:3938) from Moxley & Co., Japan Trustee Services Bank, Ltd. and others for approximately ¥340 billion on November 18, 2019. SoftBank Corp. and NAVER J.Hub Co., Ltd. entered into a definitive agreement to acquire the remaining 28.7% stake in LINE Corporation from Moxley & Co., Japan Trustee Services Bank, Ltd. and others for approximately ¥370 billion on December 23, 2019. As per the letter of intent, the companies intent to make a tender offer in LINE Corporation and will acquire common stock at ¥5,200 per share, share options at ¥1 per share option, Euroyen convertible bonds due 2023 for ¥6.9 million and Euroyen convertible bonds due 2025 for ¥6.9 million. American Depository Receipts, each representing one common share will also be acquired. As per the merger agreement, the offer per share is changed to ¥5,380. NAVER Corporation currently holds 72.6% in LINE Corporation and post completion, SoftBank Corp. and NAVER will collectively own 100% of Line. SoftBank Corp. and NAVER may appoint their subsidiaries as buyers later. As on August 3, 2020, NAVER J.Hub Co., Ltd., a subsidiary of NAVER Corporation is announced as the buyer. As on August 11, 2020, the terms were changed. The buyers will now make an offer for a total of 88.3 million shares. The offer is not for 9.4 million shares subject to the 25th stock acquisition right and also excludes 9.76 million shares of the Target Company Shares for the purpose of the stock acquisition rights attached to the bonds with stock acquisition rights owned. The purchase price is therefore calculated on the basis of 69.14 million shares at ¥5,380 per share. NAVER intends to finance the offer with debt, cash on hand or a combination thereof. In anticipation of the potential need for debt financing, NAVER has received “highly confident” letters from each of Mizuho Bank, Ltd. and Sumitomo Mitsui Banking Corporation on December 18, 2019 and December 19, 2019, respectively, indicating their high confidence of arranging debt financing for NAVER in connection with the offer. SoftBank intends to finance the offer with cash on hand. On August 3, 2020, NAVER J. Hub Corporation received a debt commitment letter from Mizuho Bank, Ltd. pursuant to which Mizuho committed to provide a term loan facility in an aggregate amount of ¥100 billion and also received a debt commitment letter from Sumitomo Mitsui Banking Corporation for ¥100 billion. LINE will become a subsidiary upon completion of the transaction. The buyers may also conduct a squeeze out if required. The companies plan to constitute Line as a joint venture later and through internal transactions merge with Yahoo! Japan. Post completion, LINE Corporation will be delisted and private.

The business integration will be subject to approval by the companies' respective shareholders, regulatory approvals, approval or filing under antitrust or competition laws in various jurisdictions, including under the Act concerning Prohibition of Private Monopoly and Maintenance of Fair Trade of Japan and the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions. The Board of Directors of Line has unanimously approved the deal. As of March 17, 2020, shareholders of SoftBank approved the transaction. As of August 4, 2020, the Fair Trade Commission of Japan issued a notice stating that it will not issue a cease and desist order against the offer and that, effective immediately, it will terminate the statutory waiting period for the pre-merger filing with the Japan FTC for the transaction, and as of the date, the Japan FTC has not filed a petition for an urgent injunction to a court with respect to the transaction. Accordingly, as of August 4, 2020, all applicable regulatory approvals with respect to the transaction have been obtained. As of August 23, 2020, Metrica Partners Pte., a minority investor of LINE Corporation stated in a statement last week, came out against the offer stating the offer is very low and said it won't tender its shares in LINE Corporation and urged other shareholders to consider following suit. Metrica is willing to exercise its appraisal rights if SoftBank and Naver squeeze out minority shareholders at the current price.  Minority stock owners who don't tender their shares can ask the courts to make a judgment on the fair price of an acquisition.
A special committee has been established by Line Corporation. An agreement is expected to be signed in December 2019 and the deal is expected to close by the end of January 2020. The tender offer would aim to start for Line around May or June 2020. As of November 18, 2019, the transaction is expected to complete by October 2020. As of June 30, 2020, parties will announce revised schedule for the implementation of the business integration, including joint offer. The relevant parties will announce a revised schedule for the implementation of the business integration, including the joint tender offer, as soon as it is confirmed. As on August 4, 2020, All Antitrust examinations have been approved. The transaction is expected to complete around March 2021.

Shinko Securities Co., Ltd. and Mizuho Securities Co., Ltd. acted as financial advisors and Nagashima Ohno & Tsunematsu and Takahiro Saito, Katie Sudol and Ian Ho of Simpson Thacher & Bartlett Llp acted as legal advisors and PwC Tax Japan acted as accountant for SoftBank Corp. Deutsche Bank acted as financial advisor and Nishimura & Asahi and Paul J. Shim, Sang Jin Han of Cleary, Gottlieb, Steen & Hamilton LLP acted as legal advisors for NAVER Corporation. JPMorgan Securities Japan Co., Ltd. acted as financial and Masahisa Ikeda, Toshiro Mochizuki and George Karafotias of Shearman & Sterling acted as legal advisors, KPMG Tax Corporation acted as accountant for Line. Anderson Mori & Tomotsune LPC acted as legal advisor and BofA Securities acted as financial advisor for the committee. Mitsubishi UFJ Morgan Stanley Securities acted as a financial advisor, Mori Hamada & Matsumoto acted as legal advisor to Z Holdings. Bradley Faris and Ivan Smallwood of Latham & Watkins LLP acted as the legal advisors in the transaction. Equiniti (US) Services LLC acted as information agent for LINE Corporation. Nomura Securities Co., Ltd. acted as paying agent for SoftBank and NAVER Corporation. Nakamura, Tsunoda & Matsumoto and White & Case acted as legal advisors, Merrill Lynch Japan Securities acted as financial advisor for Line's Special Committee. Nomura acted as a financial advisor to SoftBank. LINE has agreed to pay BofA Securities for its services in connection with the Business Integration an aggregate fee of $1.5 million (¥162.87 million), $250,000 (¥27.15 million) of which was payable upon delivery of its opinion and $1.25 million (¥132.73 million) of which is contingent upon the completion of the offer and the share consolidation. For services rendered in connection with the proposed offer, the share consolidation and the Business Integration, and the delivery of its opinion, LINE has agreed to pay J.P. Morgan a transaction fee of $8 million (¥868.64 million). NAVER agreed to pay Deutsche Bank a fee of $7 million (¥760.06 million).

SoftBank Corp. (TSE:9434) and NAVER Corporation (KOSE:A035420) completed the acquisition of the remaining 28.7% stake in LINE Corporation (TSE:3938) from Moxley & Co., Japan Trustee Services Bank, Ltd. and others on September 15, 2020.