Elon Musk in potential TikTok takeover talks with China
Bloomberg reported on Tuesday that Chinese authorities are conducting preliminary talks about selling the Chinese app TikTok to billionaire Elon Musk. The US Supreme Court announced on Friday 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 5:00 PM GMT on 19 January.
According to Bloomberg, TikTok could be sold at auction or by agreement with the American government. The article's authors suggest that this may indicate that the app's future is not solely in the hands of its parent company, ByteDance. The Chinese government holds a so-called "golden share," influencing the company's strategic decisions.
China in talks with Musk about selling TikTok
Bloomberg observed that Elon Musk's potential purchase of TikTok, which has over 170 million users in the US alone, could significantly strengthen the X platform, which he already owns. The billionaire also founded a company that deals in artificial intelligence, xAI, which could benefit from data generated by the Chinese app.
The agency noted that Chinese authorities have not yet agreed to take action on 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 has stressed 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 at about £32 billion to £41 billion in 2024. As noted, this is substantial even for the richest person in the world. Musk paid £35 billion for Twitter (now X) and is still repaying loans for that purchase.
According to the US Supreme Court's decision, ByteDance has until 19 January to sell its American division, when a law banning TikTok in the USA should 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 20 January, 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."
