The Innovation Network Corp of Japan is in the process of preparing the purchase of stake in Midokura, a tech start up firm. According to two individuals with knowledge of the transaction, the purchase would be minority shareholdings in the three year start up firm that helps develops specific software to improve network efficiency.

The amount of US$12 million would be invested into Midokura to develop technology that can help networks run more smoothly and efficiently. Another US$5.3 million was infused by local investors.

The demand on networks has increased sharply due to smartphones and cloud computing requiring increased linkage to computer systems. Other firms have also taken notice of the need to provide better services as VMWare also paid out US$1.26 billion for network software firm Nicira Inc. 

Spokespersons at INCJ and Midokuea declined to comment on the investment details.