TikTok app on phone

Twitter joins TikTok acquisition discussions

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According to the Wall Street Journal, Twitter is engaged in discussions about acquiring the immensely popular video-sharing platform TikTok, which is facing an effective ban in the US unless it secures a deal with an American buyer within the coming weeks.

As tensions brew between the White House and Beijing, US President Donald Trump has targeted Chinese tech companies with international influence such as Huawei, Tencent and TikTok. TikTok is among the world’s most popular social media platforms, with a very large following among young users.

Shortly after informally commenting that he would ban TikTok, Trump drafted an executive order which will forbid transactions with TikTok’s Beijing-based parent company ByteDance and its subsidiaries. The order cites the National Emergencies Act and the International Emergency Economic Powers Act, claiming that TikTok’s data collection practices could allow the Chinese Communist Party to “track the locations of federal employees and contractors, build dossiers of personal information for blackmail and conduct espionage”.

TikTok has repeatedly denied these allegations and has asserted that US user data are stored securely in US-based data centres. TikTok may take legal action against the executive order as soon as this week.

Despite efforts to reassure US lawmakers that TikTok is wholly independent from the Chinese Communist Party – such as with the appointment of former Disney executive Kevin Mayer as CEO – it appears that nothing short of handing TikTok over to a US-based owner is likely to appease Trump.

With the possibility of TikTok being extinguished in the US, Microsoft has entered discussions with ByteDance about acquiring TikTok. Microsoft CEO Satya Nadella has communicated directly with Trump about the possible acquisition.

Microsoft released a statement confirming that it is engaged in discussions with ByteDance and would pursue a new operating model with “word-class security, privacy and digital safety protections”. It stated that it hoped to complete discussions by 15 September. Recent reports suggest that the companies could conclude discussions as soon as the end of August and that TikTok’s global operations (not just US operations) could be on the table.

Now, the Wall Street Journal has reported that Twitter has expressed an interest in acquiring TikTok’s US operations. It said that the companies had held preliminary discussions about a possible tie-up.

It is very unlikely that Twitter is in a position to purchase TikTok, as TikTok’s US operations alone are expected to be worth approximately the same as Twitter, in the low tens of billions of dollars. It is therefore most likely that Twitter would offer to participate in the acquisition as a minority partner; Microsoft has previously stated that it may invite other US investors to participate with the acquisition on a minority basis.

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