The future of TikTok is once again shrouded in uncertainty as a significant player in the potential acquisition has withdrawn from the race. This comes at a time when the app continues to gain popularity among its users, yet many remain unaware of the looming changes regarding its ownership.
ByteDance, the Chinese company that owns TikTok, is under increasing pressure to divest from the app, necessitating a sale to a U.S.-based entity. Initially, Blackstone had intended to acquire a minority stake in TikTok’s U.S. business.
A consortium led by Susquehanna International Group and General Atlantic was seen as the frontrunner to take control of the platform’s operations. The proposed deal involved U.S. investors owning 80 percent of the business, with ByteDance hanging on to a minority share.
However, recent developments have raised concerns among investors regarding the platform’s future. The deadline for ByteDance to divest its U.S. operations has seen multiple extensions, with the latest pushed to September 17, following an executive order from President Trump.
While many lawmakers have criticized these extensions, arguing they downplay potential national security risks stemming from TikTok’s Chinese ownership, ByteDance is reportedly exploring various strategies to address these issues, including a possible restructuring or sale of its U.S. operations. Despite recent setbacks, TikTok’s financial performance remains robust, with the company reporting a staggering $43 billion in revenue in the first quarter of this year, outpacing Meta in quarterly earnings.
Should a sale materialize, it is likely that the U.S. version of TikTok would be managed by a joint venture between ByteDance and a consortium of American investors, as the company prepares for this eventuality by developing a U.S.-specific app.