SEOUL, South Korea (AP) — Line Corp., the operator of a popular mobile messaging app, has submitted an IPO application to the Tokyo Stock Exchange but might also seek a New York listing, its parent company Naver Corp. said Wednesday.
Naver, South Korea's largest Internet company, said the plan for an initial public offering in Tokyo is not final. Line, which is also the name of the app, could list in either New York or Tokyo, or both.
The move highlights the growth of Asian mobile messaging apps, driven in large part by the popularity of smartphones and connecting to the Internet through mobile devices. The apps have been a threat to longer-established Internet companies, which have responded by taking a stake in the upstart industry through acquisitions.
As of last month, Line had more than 450 million users. It has tens of millions of users in Japan, Thailand, Indonesia and Spain.
If listed, Line's market capitalization will be at least 23 trillion won ($22.2 billion), according to Lee Chang-young, an analyst at Tongyang Securities Co. That would be the same level as the market cap of Twitter Inc.
Lee said the number of monthly average users at Line is growing faster than that of Facebook or Twitter.
Other mobile messaging apps have also been involved in big deals. Facebook Inc. paid $19 billion to acquire WhatsApp and Viber Media was bought by Japan's Rakuten Inc. for $900 million.
For Internet companies that started when PCs were the predominant gateway to the Internet, messaging apps have provided a way to expand their reach to mobile phone users.
Naver owns South Korea's most-visited online search portal but is little known abroad. It reversed its fading fortunes with Line.
As the messaging app became a household name in many Asian countries, its revenues from sales of big emoticons known as stickers surged. It has diversified its revenue by courting advertisers and offering games.
Technology research company Ovum said the IPO would boost Line's presence outside Asia where most of Line's users are based.
"The IPO will not only help them get further visibility in markets outside Asia, but the resources can also be put to further marketing efforts and product innovation to grow their user base internationally," said senior analyst Neha Dharia.