Officials of Z Holdings, the parent company of major internet company Yahoo Japan and messaging app provider Line, say the three companies plan to merge in the upcoming fiscal year that starts in April.

They say the merger is aimed at speeding up managerial decision-making and boosting synergy among the group companies.

The company officials say a project team will be set up to work out the details of the plan.

Yahoo Japan and Line integrated their operations under Z Holdings in March 2021. They have provided a variety of services, including social media, online advertising and financial services.

But their advertising revenues have recently been stagnant partly due to the impact of the coronavirus pandemic.

Z Holdings says the three-way merger is also intended to enhance corporate governance.

Line was criticized for an oversight in its handling of user data in 2021. Engineers of a Chinese firm that was subcontracted to perform system maintenance had accessed sensitive data, including personal information of Line users in Japan.