According to the WSJ, Twitter is seeking a “combination” with TikTok parent ByteDance. This could mean the company does not seek to purchase operations but instead have licensing in certain markets. Whether it’s Microsoft or Twitter, any deal for TikTok would have to clear major obstacles. The most obvious is Donald Trump actively trying to remove the company from the United States. This is part of his war against Chinese companies who the administration believe are working with the China government. An executive order stops ByteDance from handling any transactions in the United States. This order will come into effect within the next 45 days and could mean TikTok leaves the market in the country. However, ByteDance says it will challenge the order. It is believed some companies are interested in rescuing TikTok in the country. Any purchase would allow the buyer to control the brand in relevant markets. ByteDance would retain control in other markets.
Microsoft’s Interest
A week ago, Microsoft said it was looking at TikTok’s U.S. operations. It is clear Redmond is serious about a potential deal considering it’s rare for a company to confirm such interest before making an offer. Microsoft CEO Satya Nadella and Trump spoke about the matter and Microsoft says discussions are ongoing. Such a concrete interest suggests Microsoft has been following TikTok for some time. Any deal would be huge and cost Microsoft billions. Just a week ago, Reuters reported on Sequoia Capital and General Atlantic bidding for the entirety of TikTok for $50 billion. Microsoft is interested only in operations in the U.S., New Zealand, Australia, and Canada. Still, this would require a massive outlay considering TikTok claims to have 100 million users in the U.S. alone and is growing.
