CEO of ByteDance balks at selling TikTok in the US

CEO of ByteDance balks at selling TikTok in the US

ByteDance founder and CEO Yiming Zhang’s decision to abandon his pursuit of a sale of TikTok ‘s U.S. operations to Microsoft Corp in favour of an alliance with Oracle Corp was the result of pressure from investors from the Beijing-based company as it pursued a compromise to appease the U.S. and China, according to people familiar with the deliberations.

Concerns among big ByteDance backers including Sequoia and General Atlantic over the financial risk of selling the famous U.S. short-video app for less than what it’s worth led Zhang to settle for the sale of only one stake to Oracle. Rather than an outright divestment, the sources said.

ByteDance tries to outcome the conflict

It is a dangerous tactic. President Donald Trump made it known that he wants a simple selling of TikTok to a U.S. Technology firm. Despite fears by national security officials that U.S. consumer data might be passed on to the government of the Communist Party of China. He ‘s threatened to suspend TikTok as early as Sept. 20 in the United States if ByteDance fails to comply.

China also engaged in the project last month, changing its export control rules to allow it a vote on technology transfer. Including the suggestion algorithm from TikTok, to a foreign buyer. Chinese officials have said that the United States could not coerce ByteDance into an arrangement.

Over the course of the past week, Microsoft executives grew irritated when the company remained unresponsive to the Redmond, Washington-based company’s US$ 20 billion plus offer for U.S. Market TikTok, three sources said. The bid also allowed forward payments based on the success of TikTok, added one of the sources.

The bid fell short of the aspirations of ByteDance investors, the sources said. Microsoft angered Zhang in lobbying for his bid with the Trump administration and U.S. senators. Since it pointed to TikTok as a security issue it should tackle, the sources said. ByteDance has maintained that there is no such challenge to its possession of TikTok.

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