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Changes in Subsidiaries (Sub-Subsidiaries)

SoftBank Group Corp.

SoftBank Group Corp. (“SBG”) announced today that LINE Corporation (“LINE”)*, LINE Financial Corporation, and LINE Financial Asia Corporation Limited have become subsidiaries (sub-subsidiaries) of SBG as of today.

  • LINE will change its company name to A Holdings Corporation (“AHD”) as of February 28, 2021.

1. Reason and method for the change

As announced in the “Entry into a Definitive Agreement by Subsidiaries (SoftBank Corp., and Z Holdings Corporation) Regarding the Business Integration of Z Holdings Corporation and LINE Corporation, and the Planned Commencement of a Joint Tender Offer for the Shares of LINE Corporation by a Subsidiary (SoftBank Corp.) and NAVER Corporation” dated December 23, 2019, LINE, as the surviving corporation, implemented as of today an absorption-type merger (the “Absorption-type Merger”) with Shiodome Z Holdings GK, a wholly owned subsidiary of SoftBank, as the absorbed corporation, as part of the business integration between Z Holdings Corporation (Securities Code: 4689, Tokyo Stock Exchange First Section; a subsidiary of SBG; “ZHD”) and LINE (the “Business Integration”) pursuant to a business integration agreement that SoftBank, NAVER, ZHD and LINE entered into as of December 23, 2019.

Through a series of transactions including the Absorption-type Merger, LINE as well as LINE Financial Corporation and LINE Financial Asia Corporation Limited, all of which are wholly owned subsidiaries of LINE, have become subsidiaries (sub-subsidiaries) of SBG as of today.*1 *2

  1. Descriptions regarding LINE’s subsidiaries other than LINE Financial Corporation and LINE Financial Asia Corporation Limited are omitted in this notice as the changes in them fall under the minor change criteria under the timely disclosure rules.

  2. LINE will transfer its entire business (excluding the ZHD shares, the contractual status pursuant to the agreements executed by LINE in relation to the Business Integration, and the rights and obligations set out in the absorption-type demerger agreement) to its wholly owned subsidiary, LINE Demerger Preparatory Company, in an absorption-type demerger (the “Corporate Demerger”) as of February 28, 2021. For accounting purposes, the acquisition date will be February 28, 2021, the date when the Corporate Demerger will become effective, as the Absorption-type Merger and the Corporate Demerger are deemed to be a series of transactions regarding the Business Integration.

2. Outline of the subsidiaries (sub-subsidiaries)

(i) LINE Corporation

(1) NameLINE Corporation
(2) Address4-1-6 Shinjuku Shinjuku-ku, Tokyo
(3) Name and title of representativeTakeshi Idezawa, Representative Director and President
(4) Nature of businessAdvertising service based on the mobile messenger application “LINE”, core businesses including the sales of stickers and game services, and strategic businesses including Fintech, AI, and commerce services
(5) Share Capital JPY 101,788 million (as of December 31, 2020)
(6) FoundedSeptember 4, 2000
(7) Major shareholders and shareholding ratiosSoftBank Corp.50.00%
NAVER Corporation42.25%
NAVER J.Hub Corporation7.75%
(8) Relationships with SBGCapital relationshipSBG, through SoftBank, owns 50.00% of the shares in LINE
Personnel relationshipNot applicable
Business relationshipThere are business relationships with respect to advertising services, etc.
(9) Results of operation and financial position over the past 3 years (Consolidated, IFRS)
 Fiscal yearFiscal year ended December 31, 2017Fiscal year ended December 31, 2018Fiscal year ended December 31, 2019
 Total capitalJPY 189,977 millionJPY 208,514 millionJPY 174,663 million
 Total assetsJPY 303,439 millionJPY 486,587 millionJPY 541,352 million
 Equity attributable to owners of parent per shareJPY 779.30JPY 833.87JPY 659.96
 RevenuesJPY 167,147 millionJPY 207,182 millionJPY 227,485 million
 Operating income (loss)JPY 25,078 millionJPY 16,110 millionJPY -38,997 million
 Income (loss) attributable to owners of the parent companyJPY 8,078 millionJPY -3,718 millionJPY -46,888 million
 Earnings per share: basic profit (loss) for the periodJPY 36.56JPY -15.62JPY -196.07
 Dividends per share---

(ii) LINE Financial Corporation

(1) NameLINE Financial Corporation
(2) Address1-1-1 Nishi Shinagawa, Shinagawa-ku Tokyo
(3) Name and title of representativeTetsuhiko Saito, Representative Director and CEO
(4) Nature of businessProvision of financial services
(5) Share Capital JPY 45,650 million (as of February 26, 2021)
(6) FoundedJanuary 10, 2018
(7) Major shareholders and shareholding ratiosLINE Corporation100.00%
(8) Relationships with SBGCapital relationshipSBG, through SoftBank, owns 50.00% of the shares in LINE, the parent company of LINE Financial Corporation.
Personnel relationshipNot applicable
Business relationshipNot applicable
(9) Results of operation and financial position over the past 3 years (Standalone, Japanese GAAP)
 Fiscal yearFirst Fiscal Year:
Fiscal year from January 10, 2018 until May 31, 2018
Second Fiscal Year:
Fiscal year from June 1, 2018 until March 31, 2019
Third Fiscal Year:
Fiscal year from April 1, 2019 until March 31, 2020
 Sales-JPY 127 millionJPY 405 million
 Operating income (loss)JPY -188 millionJPY -1,648 millionJPY -3,010 million
 Ordinary income (loss)JPY -260 millionJPY -1,754 millionJPY -3,280 million
 Net income (loss)JPY -261 millionJPY -1,755 millionJPY -4,277 million
 Net income (loss) per shareJPY -183.16JPY -447.09JPY -599.85
 Total assetsJPY 20,005 millionJPY 58,491 millionJPY 72,695 million
 Net assetsJPY 19,739 millionJPY 57,051 millionJPY 72,238 million
 Net assets per shareJPY 9,869.73JPY 9,669.69JPY 9,261.26
 Dividends per share---

(iii) LINE Financial Asia Corporation Limited

(1) NameLINE Financial Asia Corporation Limited
(2) AddressUnits 04-05, 26/F, Railway Plaza, 39 Chatham Road South, Tsim Sha Tsui, Kowloon, Hong Kong
(3) Name and title of representativeHWANG In Joon, Director
(4) Nature of businessFinancial business strategy
(5) Share Capital JPY 39,523 million (as of February 26, 2021) *
(6) FoundedSeptember 4, 2018
(7) Major shareholders and shareholding ratiosLINE Financial Plus Corporation100.00%
(8) Relationships with SBGCapital relationshipSBG, through SoftBank, owns 50.00% of the shares in LINE, the parent company of LINE Financial Asia Corporation Limited.
Personnel relationshipNot applicable
Business relationshipNot applicable
(9) Results of operation and financial position over the past 3 years (Standalone, IFRS)
 Fiscal yearFirst Fiscal Year:
Fiscal year from September 4, 2018
until December 31, 2019
 Sales-
 Operating lossJPY -461 million
 Net lossJPY -1,048 million
 Net loss per shareJPY -431.63
 Total assetsJPY 39,456 million
 Net assetsJPY 39,089 million
 Dividends per share-
  • The exchange rate as of February 25, 2021 (1 USD = JPY 105.90480) has been used for the conversion from USD to JPY.

3. Date of change

February 26, 2021

4. Outlook

As a result of the series of transactions for the Business Integration including the Absorption-type Merger, AHD (currently LINE) will become a subsidiary in which SBG holds 50% of the shares through SoftBank. AHD is expected to hold 65.3% of the ZHD shares, the listed integrated company after the Business Integration. The impact of these changes on SBG’s consolidated financial results for the fiscal year ending March 2021 is expected to be minimal.

Reference: Consolidated financial results forecast for the fiscal year ending March 2021 and actual for the fiscal year ended March 2020

 Net salesIncome before income taxNet income
attributable to owners
of the parent
Forecast for the fiscal year ending March 2021---
Actual for the fiscal year ended March 2020JPY 5,238,938
million
JPY 50,038
million
JPY -961,576
million
  • Net sales and income before income tax are presented in results of continuing operations only.

SBG does not provide forecasts of consolidated results of operations because they are difficult to project due to numerous uncertainties affecting earnings.

  • Releases, announcements, presentations and other information available from this page and elsewhere on this website were prepared based on information available and views held at the time of preparation and speak only as of the respective dates on which they are filed or used by SoftBank Group Corp. or the applicable group company, as the case may be. Such information is subject to change and may become out-of-date. Such information may also contain forward-looking statements which are by their nature subject to various risks and uncertainties that may cause actual results and future developments to differ materially from those expressed or implied by such statements. Please read legal notices in its entirety prior to viewing any information available on this website.

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