Sources: Yahoo Japan, Line Negotiating Tie - Up

Sources: Yahoo Japan, Line negotiating tie-up

Yahoo Japan under Softbank Group and messaging app Line are negotiating toward a tie-up, according to sources close to the matter.

The sources say Softbank and Line's parent company, Naver of South Korea, are considering making 50-50 investments toward creating a new firm, establishing a holding company under it and making Yahoo Japan and LINE subsidiaries of the company.

The sources say officials are aiming to reach an agreement by the end of this month.

Line has more than 80 million users in Japan. It is working on a wide range of financial services for smartphone platforms, including payment service.

But the firm fell into the red due to large investments with the aim of gaining users.

Yahoo apparently wants to expand its smartphone payment and other services by tapping into Line's customer base.

In September, Yahoo announced the acquisition of online fashion retailer Zozo through an investment of about 400 billion yen, or 3.7 billion dollars.