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TikTok Navigates a Difficult Deal As They Near Sale Deadline

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Key Points

  • ByteDance is still in the process of considering offers from two potential buyers—Oracle Corporation and Microsoft Corporation, which teamed up with Walmart, Inc.
  • The deal to sell is pressing forward despite signs emerging that ByteDance is under pressure from the Chinese government to close TikTok in the U.S. market rather than making and completing a sell agreement with the American government, according to the report Reuters made on Friday.
  • Another vital aspect of the deal that adds to the confusion is the deadline on which TikTok has to follow. One person close to ByteDance said that the company is sticking to the September 20th deadline, which is the deadline imposed on the executive order that President Trump signed last August 6th
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ByteDance Ltd., the China-based company that owns the video-sharing app TikTok, is still in the process of considering offers from two potential buyers—Oracle Corporation and Microsoft Corporation, which teamed up with Walmart, Inc.

According to a person with knowledge about the matter who wishes not to be named discussing the company’s internal plans, TikTok is pushing to sell its U.S. operations ahead of a September 15th deadline imposed by U.S. President Donald Trump. The deal to sell is pressing forward despite signs emerging that ByteDance is under pressure from the Chinese government to close TikTok in the U.S. market rather than making and completing a sell agreement with the American government, according to the report Reuters made on Friday.

In response to this report, a TikTok representative said, “the government has never suggested to us that we should shut down TikTok in the U.S. or any other market.”

Said one person familiar with the matter, the companies involved in the negotiations for the sale of TikTok’s U.S. operations were focused on securing a preliminary agreement on or before September 20th and then sealing the deal by December. However, the controversial app found itself at the center of confusing deal negotiations and political debate.

In early August, President Trump threatened to ban the video-sharing app citing national security concerns. He then ordered the company to sell its operations in the U.S. and imposed a deadline for a deal by September 15th. Later that month, the Chinese government introduced several new restrictions on selling specific technologies that slowed down any potential negotiations.

One of the contributing factors that made the negotiations complicated is the number of involved parties TikTok should satisfy to seal a deal. ByteDance has to reach an agreement that meets both the acquirer’s and its venture capital investors’ terms while also pleasing the two governments clashing with each other on this deal.

Another vital aspect of the deal that adds to the confusion is the deadline on which TikTok has to follow. One person close to ByteDance said that the company is sticking to the September 20th deadline, which is the deadline imposed on the executive order that President Trump signed last August 6th, giving the company a 45-day timeline to present something to the Trump administration. On the other hand, President Trump has been insisting a deadline of September 15th in his media commentaries.

China’s assertion of authority over the deal also upended negotiations between parties involved, making it harder for TikTok to meet the imposed deal deadline. Striking a deal that pleases both China and the Trump administration will depend on ByteDance’s capability to navigate a complex and confusing deal.

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