China eyes sale of TikTok to Elon Musk amid U.S. deadline
Bloomberg reported on Tuesday that Chinese authorities are conducting preliminary talks about selling the Chinese app TikTok to billionaire Elon Musk. On Friday, the U.S. Supreme Court announced that a decision regarding the sale of TikTok's American division or a ban on the app's use in the country will be made by January 19 at 1:00 p.m. Eastern Time.
According to Bloomberg, TikTok could be sold through an auction or by agreement with the American government. This suggests that the app's future might not be entirely in the hands of its parent company, ByteDance. As noted, the Chinese government holds a so-called "golden share," which gives it influence over the company's strategic decisions.
China in talks with Musk about selling TikTok
The potential purchase of TikTok by Elon Musk, which has over 170 million users in the U.S. alone, could significantly strengthen the X platform, of which he is already the owner, Bloomberg observed. The billionaire also founded a company dealing in artificial intelligence, xAI, which could benefit from data generated by the Chinese app.
The agency noted that Chinese authorities have not yet agreed on taking action in this matter. It is unclear to what extent ByteDance is aware of the discussions between Musk and Beijing. It is also unknown whether Musk, TikTok, and ByteDance have held talks about the terms of a potential deal.
"We cannot be expected to comment on pure fiction," a TikTok spokesperson said of Bloomberg’s reports. In previous statements, the company emphasized that the Chinese government's involvement in ByteDance's ownership structure does not affect its global operations outside China, including those concerning TikTok.
Thus far, Musk, X, and the Chinese ministries of cyberspace and commerce have not commented on the matter.
TikTok is running out of time
Bloomberg analysts estimated the value of TikTok's American operations to be about CAD 53-66 billion in 2024. As noted, this is substantial even for the wealthiest person in the world. It was recalled that Musk paid about CAD 58 billion for Twitter (now X) and is still repaying loans taken out for that purchase.
According to the U.S. Supreme Court's decision, ByteDance has until January 19 to sell its American division, when a law banning TikTok in the USA is supposed to take effect. The company has appealed this decision, arguing that it violates the right to freedom of speech. Donald Trump, who will be inaugurated as President of the United States on January 20, has also called for delaying the implementation of these regulations so that his new administration will have more time to work out a "political solution."
