Japan's Line sets price range for 112b yen IPO: WSJ

[TOKYO] Line Corp and its owners have set the price range for the company's IPO at between 2,700 yen and 3,200 yen a share, the Wall Street Journal reported, in what could become the biggest technology initial public offering globally this year.

Japan's most popular mobile-messaging service, backed by South Korean search portal Naver Corp, and existing investors aim to raise as much as 112 billion yen (S$1.49 billion), the Journal cited a person familiar with the matter as saying.

The Tokyo-based company had said earlier it planned to sell shares with an indicative price of 2,800 yen. Line is offering 35 million shares in Tokyo and New York. If a further 5.25 million shares are sold through a green-shoe option, it could wind up raising 129 billion yen at the top end of the range. The range gives Line a valuation of 20 to 24 times earnings, the Journal cited the person as saying.

Line is planning to go public during one of the most tumultuous times for global markets in years. It's announcing pricing Tuesday, a day later than originally planned, after the UK's vote last week to exit the European Union sent stocks and currencies into a tailspin.

More than US$974 billion has been erased from S&P 500 stock values in the past two days, the third-most in history.

Stocks in Tokyo have fallen roughly 7 per cent since Line filed its IPO on June 10, while the S&P 500 has fallen about 4.6 per cent. Prior to the UK's vote, San Francisco-based Twilio Inc surged 92 per cent in its Thursday public debut in New York.

The stellar performance of the maker of mobile and web applications was the first positive sign since last year that investors appetite for tech IPOs was recovering.

Line is raising funds as it confronts mounting challenges from Facebook Inc's Messenger and WhatsApp, which have about 2 billion users, and China's WeChat service. Line debuted in 2011 and pioneered the business model of selling stickers and other digital knickknacks that people buy and share while chatting on smartphones.

The moribund market for new listings has limited exit options for the more than 160 startups currently valued at US$1 billion or more, according to CB Insights figures. No technology company has raised more than US$150 million in an IPO this year, data compiled by Bloomberg show.

Nomura Holdings Inc, JPMorgan Chase & Co, Morgan Stanley and Goldman Sachs Group Inc are the lead underwriters of the IPO.

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