SoftBank has entered an agreement with Japan's most popular messaging service Line to acquire a majority stake in the company's mobile business.

Line Corp, which is dual-listed in New York and Tokyo, said Wednesday that it would enter into a strategic partnership with the Japanese tech giant to expand the provision of its mobile service.

SoftBank will hold a 51 percent stake in Line Mobile, Line's mobile virtual network operator (MVNO), following the allocation of new shares, while Line will hold 49 percent. Line said it expects the transaction to be completed around March.

Ayano Kado, representative director and president of Line Mobile, said in a statement: "Through this partnership between Line — which brought to light a new form of communication in the smartphone generation — and SoftBank — the first carrier in Japan to carry the iPhone and drove the smartphone market — we will bring together our mutual strengths and strive to further improve users' experiences with Line Mobile and continue to provide an appealing service that builds value in response to users' diverse needs."

Kado will continue in her role as Line Mobile's representative director and president, the company said.

SoftBank was not immediately available for comment when contacted by CNBC.

Line, which has 200 million monthly active users globally, is facing increased competition from the likes of Facebook-owned WhatsApp in its four key markets of Japan, Thailand, Indonesia and Taiwan.

The firm said that its MVNO business "continues to grow steadily" despite a slowdown in growth among the broader MVNO market.

The Japanese company also said that it plans to launch a cryptocurrency exchange, loans and insurance to its offering, in addition to its current in-app money transfer and payment service.