TikTok deal latest: Chinese video app on verge of major sale in the US

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For weeks, companies have scrambled to enter negotiations with the social media app’s parent company ByteDance ever since President Donald Trump announced the app faced a US ban unless a domestic buyer was found. Now, inside sources have told CNBC the successful bidder has been decided, and the news could be announced as soon as today.

Microsoft, which recently teamed up with Walmart to clinch a deal, was quick to enter talks with ByteDance and has been considered the frontrunner to purchase TikTok.

However, it is competing with software giant Oracle, while there has also been speculation Twitter and Netflix have considered bids.

Plans to sell TikTok to a US company had been thrown into doubt over the weekend after ByteDance said it would be affected by a new Chinese law restricting artificial intelligence exports.

The law meant certain technology, some of which is relevant to TikTok, would require a Chinese government permit in order to be exported.

It is unclear how this will affect the TikTok deal at the moment, but the deal could be impeded.

Other developments over the course of the past few weeks include the resignation of TikTok’s CEO Kevin Mayer.

In a letter, Mr Mayer said the “political environment has sharply changed”.

In addition, TikTok itself last week announced it had filed legal action against the Trump administration’s actions against it.

READ: TikTok bombshell: Donald Trump to be sued by controversial Chinese video app

In any case, estimates on the value of the deal have ranged from $20 billion to $50 billion.

If the deal is indeed announced today, then it will be comfortably within the tight timescale Mr Trump – and Microsoft – had set.

The president issued an order at the start of August which would effectively ban TikTok by September 20.

Microsoft, meanwhile, had claimed it would be able to settle a deal to purchase TikTok five days before then.

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The order read: “The spread in the United States of mobile applications developed and owned by companies in the People’s Republic of China continues to threaten the nation security, foreign policy, and economy of the United States.

“At this time, action must be taken to address the threat posed by one mobile application in particular, TikTok.”

Mr Trump claimed the app allowed the Chinese government “access to Americans’ personal and proprietary information” and that this could allow the country to “track the locations of Federal employees and contractors, build dossiers of personal information for blackmail, and conduct corporate espionage.”

TikTok, however, has denied that its platform could be manipulated by the Chinese government.

The video-sharing app said: “The executive order seeks to ban TikTok purportedly because of the speculative possibility that the application could be manipulated by the Chinese government.

“But, as the U.S. government is well aware, Plaintiffs have taken extraordinary measures to protect the privacy and security of TikTok’s U.S. user data, including by having TikTok store such data outside of China (in the United States and Singapore) and by erecting software barriers that help ensure that TikTok stores its U.S. user data separately from the user data of other ByteDance products.

“By banning TikTok with no notice or opportunity to be heard (whether before or after the fact), the executive order violates the due process protections of the Fifth Amendment.”

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