SoftBank Corp. would attract younger consumers and help boost usage by acquiring a stake in instant messaging service Line Corp., an analyst at Bank of America Corp.'s Merrill Lynch unit said.
Average revenue per mobile user has declined at wireless phone carriers as consumers shift to free mobile-messaging and voice applications like Line, Yoshiyuki Kinoshita, a Tokyo-based analyst at Merrill Lynch, said in a report Tuesday.
SoftBank is reportedly seeking to buy a stake in Line, which is controlled by South Korea's Naver Corp.
Services that rely on Internet access to let users send messages or make calls are displacing traditional text messaging services offered by wireless carriers such as SoftBank.
This month Facebook Inc. said it would pay as much as $19 billion to acquire WhatsApp Inc., just days after Rakuten Inc. agreed to pay $900 million for rival Viber.
"The global Internet industry has seen a number of M&A as major platforms in each space" look to build unified platforms, Kinoshita wrote in a note to investors. "Strengthening in this area looks like a logical move to us."
Line has received at least one other offer for all or some of the company, prompting it to slow preparations for an initial public offering, sources have said. Tokyo-based Line, which has about 340 million users, may be valued at as much as $14.9 billion, according to BNP Paribas SA estimates.
Fumiko Hayashi, a spokeswoman for Line, declined comment Wednesday on the analyst report. On Tuesday, she said Line hasn't received any offers from SoftBank or anyone else seeking a partial stake or the entire company.
Hiroe Kotera, a spokeswoman for SoftBank, also declined comment Wednesday on the analyst report.