Elon Musk eyes TikTok acquisition amid US‑China tightrope
Chinese authorities are conducting initial talks about selling the Chinese app TikTok to billionaire Elon Musk, Bloomberg reported on Tuesday. On Friday, the U.S. Supreme Court announced that a decision regarding the sale of TikTok's American division or a possible ban on the app's use in the country will be made by January 19.
According to Bloomberg, TikTok could be sold via an auction or through an agreement with the American government, which, the article suggests, indicates that the app's future is not solely in the hands of its parent company, ByteDance. Notably, the Chinese government holds a so-called "golden share," which allows it to influence the company's strategic decisions.
China in talks with Musk about selling TikTok
The potential purchase of TikTok by Elon Musk, which boasts over 170 million users in the U.S. alone, could significantly bolster the X platform, of which he is already the owner, Bloomberg observed. The billionaire also founded a company focused on 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. 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 engaged in talks about the terms of a potential deal.
"We can’t be expected to comment on pure fiction," a TikTok spokesperson said in response to Bloomberg’s reports. In previous statements, the company emphasized that the Chinese government's involvement in ByteDance's ownership structure does not affect the company's global operations outside China, including those concerning TikTok.
So 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 estimate the value of TikTok's American operations at about $40-50 billion in 2024. As noted, this is a substantial amount even for the wealthiest person in the world. It was recalled that Musk paid $44 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, as 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."