- TikTok’s owner ByteDance is reportedly seeking a valuation of $60 billion for its US operations.
- ByteDance reached an agreement with Oracle and Walmart this weekend, under which both companies will take a 12.5% and 7.5% share respectively in the Chinese firm.
- Both companies will pay a combined $12 billion if the asking price is met.
- The US initially planned to ban TikTok from Apple and Google’s stores on Sunday.
- The decision has now been delayed by a week according to the Department of Commerce.
- Visit Business Insider’s homepage for more stories.
TikTok’s Chinese owner ByteDance is seeking a valuation of $60 billion for TikTok Global, its proposed new US company, Bloomberg reported Sunday.
Bloomberg reported, citing an anonymous source, that technology services company Oracle and retailer Walmart will take stakes of 12.5% and 7.5%, respectively in TikTok Global. The two will pay a combined $12 billion if they agree to ByteDance’s $60 billion asking price.
The deal gives China’s ByteDance 12 months to hold an initial public offering in the US.
Read More: GOLDMAN SACHS: Buy these 21 stocks on track for years of market-beating growth that could make them future giants – even rivals to the FAANGs
Bloomberg added the final valuation has still not been calculated, as both firms still need to decide on measures for data security as well as the equity structure.
The deal is still pending approval from China.
The company has prevented its video-sharing app from banned for at least a week as the US previously announced Friday it would ban all new downloads of TikTok and WeChat starting Sunday, demanding that the app be removed from Apple and Google’s app stores.
“I approved the deal in concept,” US president Donald Trump told reporters Saturday.
TikTok has been scrambling to find a US buyer for its operations, or it risks being banned altogether in the United States.
The US says that the app threatens the country’s national security and ByteDance needs to find a US buyer for TikTok.
Read More: An ex-Wall Street chief strategist says the market’s comeback has made most investors ‘blissfully unaware’ of its real risks – and lays out 6 reasons why another free-fall is on the cards
TikTok, a video-sharing app that resonates with teenagers has taken the world by storm. It has however become a major sticking point in the trade war between the US and China that began in 2018.
TikTok was in discussions for a possible take-over by Microsoft, but those talks broke down after ByteDance rejected its offer.
The US administration has claimed the new entity will be controlled by Americans, but CNBC said ByteDance will still retain an 80% stake in TikTok Global.
A judge blocked a US effort over the weekend to ban Chinese messaging app WeChat, owned by Tencent.
ByteDance has said it will not transfer its algorithms to Oracle, a condition the US administration was pushing for.
The company had planned to list its entire business in a global IPO, but back in July was said to be considering a listing in Hong Kong only, after diplomatic relations between the United States and China deteriorated.