(Bloomberg) — Holdings Corp., a holding company equally owned by Japan’s SoftBank Corp. and South Korea’s Naver Corp., plans to sell its stake in LY Corp.’s 150 billion yen ($1 billion) offering, SoftBank said. Friday.
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The bid comes as the operator’s ownership of Japan’s biggest messaging app threatens to become a diplomatic flashpoint between Japan and South Korea.
Japan’s Ministry of Internal Affairs and Communications said SoftBank and Naver’s 50-50 control of LY leaves the messaging app vulnerable to cyberattacks. It called for an ownership change that would give LY the independence to demand stronger safeguards from Naver.
Data leaks stemming from a breach of Naver’s cloud service last year have led to scrutiny from Japanese regulators, who in turn are under pressure from the US government to strengthen the country’s cybersecurity. Naver’s cloud service helps manage user information for LY’s Line messaging app, popular in Japan and Taiwan.
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