As China Faces Increasing Pressure to Ban TikTok in the US... American Investors Push for Acquisition

US Venture Capital Discusses Spin-Off Plan from TikTok Parent Company ByteDance

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] According to major foreign media reports on the 22nd (local time), Chinese social networking service (SNS) TikTok, which is facing pressure to be banned in the United States, is reportedly pursuing a plan to be acquired by a group of American investors.

According to the reports, an investor group led by venture capital firms General Atlantic and Sequoia Capital is discussing a plan to acquire TikTok from its parent company, Chinese ByteDance. It is known that they are coordinating with authorities on whether TikTok can continue operations in the U.S. if it is separated from ByteDance by establishing a firewall.

The firewall completely blocks influence from the Chinese parent company, meaning that even after the American investor group acquires TikTok, ByteDance will retain some shares but will not have voting rights.

Previously, former U.S. President Donald Trump openly stated in an interview with a media outlet that he was "considering banning TikTok," calling it "one way to retaliate against China." U.S. Secretary of State Mike Pompeo also mentioned that "a plan to ban Chinese SNS, including TikTok, is under review."

As pressure from U.S. authorities to expel TikTok on national security grounds intensifies, the move to replace TikTok’s ownership with an American company aims to dispel security concerns.

To distance itself from China, TikTok hired a former Disney executive as CEO in May. Additionally, just the day before, TikTok announced plans to hire an additional 10,000 employees in the U.S. over the next three years. Considering TikTok’s global workforce is about 14,000, this is a significant scale.

Besides the American venture capital firms currently discussing TikTok’s acquisition, New York private equity funds and Silicon Valley IT companies have also approached ByteDance for the acquisition. However, General Atlantic and Sequoia Capital are reported to be in the most advanced stages of discussion. The amount they have offered for TikTok has not been disclosed.

This content was produced with the assistance of AI translation services.