Existing U.S.-based investors in ByteDance, TikTok’s parent company, are leading discussions to acquire TikTok’s U.S. operations, aiming to address national security concerns and prevent a potential ban. Key investors involved include Susquehanna International Group, General Atlantic, and private equity firm KKR. The proposed plan involves spinning off TikTok’s U.S. entity, reducing Chinese ownership to below 20%, and ensuring data security through Oracle’s infrastructure. This initiative seeks to comply with U.S. legislation requiring ByteDance to divest its U.S. TikTok assets by April 5 or face a ban due to apprehensions about Chinese government influence.
The White House has been actively involved in these negotiations, with Vice President JD Vance overseeing the process. This level of direct government intervention in a corporate transaction is unprecedented and adds complexity to the discussions. The outcome remains uncertain, particularly regarding whether the sale will include TikTok’s critical algorithm, potentially affecting the deal’s valuation, estimated between $50 billion to $100 billion.
Other investor groups, such as those led by billionaire Frank McCourt and YouTube star Mr. Beast (Jimmy Donaldson), have also expressed interest in acquiring TikTok’s U.S. operations. However, the consortium of existing ByteDance investors, in collaboration with Oracle, currently appears to be the front-runner in these negotiations.
The proposed restructuring aims to alleviate U.S. concerns over data privacy and national security by establishing a U.S.-controlled entity for TikTok, thereby ensuring the platform’s continued operation in the American market.
