As the April 5 deadline quickly approaches to find a non-Chinese buyer for TikTok, several suitors have emerged as front-runners to take control of the controversial social media platform.
According to The Financial Times, Andreessen Horowitz is in talks to buy out TikTok’s Chinese investors as part of a broader bidding group led by Oracle (NYSE:ORCL) to carve out the platform from the parent company, ByteDance
Blackstone Group (BX) has also been approached as part of late-stage talks to split TikTok away from ByteDance (BDNCE) before the April 5 deadline, after which the platform would be banned from the U.S.
Finding a buyer might not be the only hurdle the Trump Administration faces, as the fraught relationship between the U.S. and China could complicate negotiations.
“We view TikTok as one of the biggest and first chips on the poker table around U.S./China relations,” said Wedbush analyst Dan Ives, adding that with the tariff announcements slated for tomorrow the TikTok situation must be carefully handled by the Trump White House to keep a friendly U.S./China tone heading into a potential summit.
Ives sees an Oracle (NYSE:ORCL) deal led by Larry Ellison as the most likely outcome. Oracle (NYSE:ORCL) is already TikTok’s primary cloud provider, which could leave the algorithm under ByteDance (BDNCE) control but with Oracle a “linchpin” to secure U.S. consumer data. An Oracle/Ellison deal could also leave ByteDance (BDNCE) and China with minority ownership. Ives pegs the value of TikTok with the algorithm at around $100B, and at $30B to $40B without.
“TikTok needs to be handled with kid gloves given the importance of this social media platform,” he says, “We see no way that the TikTok algorithm is sold as Beijing and ByteDance would view this as a non-starter in a deal.”
However, according to federal law, ByteDance (BDNCE), which has been designated as a “foreign adversary” cannot retain more than a 20% stake in the company, and the app’s U.S. operations cannot have any coordination with ByteDance (BDNCE) pertaining to its algorithm or data sharing.
President Trump is eager to see the platform remain, and has even suggested he would extend the deadline beyond April 5 to make a deal happen.
“We have a lot of potential buyers,” the president recently said, and has even intimated he would reduce tariffs on China to reach an agreement.
“Maybe I’ll take a couple of points off (of tariffs) if I get approval for something,” Trump was quoted by CNN, addressing concerns that the Chinese are uninteresting in any type of deal.
If a deal isn’t reached in time, TikTok goes dark again on April 5.
