TikTok’s US arm could be sold to Musk – Bloomberg

Chinese officials are reportedly considering the sale of TikTok’s US operations to tech billionaire and X owner Elon Musk if the short-video app cannot avoid an impending ban in the country, Bloomberg claimed in an article published on Tuesday, citing anonymous sources. TikTok has branded the allegation “pure fiction.”

Discussions are at the early stages, according to Bloomberg, with officials in Beijing preferring that TikTok remains under the control of its China-based owner, ByteDance. The potential sale is being explored as a contingency plan to prevent a long-threatened ban in the US, the outlet has claimed.

The 2024 Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA) requires ByteDance to divest TikTok’s US operations by January 19, 2025 or face an outright ban in the country. When signing the bill, outgoing US president, Joe Biden, cited national security concerns, despite the app's reported 170 million daily users in the country.

The reports of Chinese officials allegedly discussing a possible sale come amid increased scrutiny of TikTok in the US over concerns that user data could be accessed by the Chinese government – claims that the company has consistently denied.

Last week, the US Supreme Court heard arguments over the law that would force the sale or a shutdown of TikTok, with justices apparently leaning toward upholding the legislation.

According to Bloomberg, one scenario involves Musk’s social media platform X taking control of TikTok’s US operations, valued last year at around $40 billion to $50 billion.

It remains unclear, however, to what extent ByteDance or Musk are aware of the alleged discussions among Chinese officials regarding the app sale. Additionally, there is no information on whether ByteDance, TikTok, and the owner of X have engaged in any talks about a potential deal, the outlet said. 

In response to inquiries about the Bloomberg report, TikTok has stated that it “can’t be expected to comment on pure fiction.”

The Chinese government owns a 1% stake, known as a “golden share,” in a ByteDance affiliate, granting it influence over the company’s strategic decisions and operations. Bytedance itself is 60% owned by institutional investors, including the US-based Blackrock, 20% by staff and 20% by the company's founders.

TikTok has previously claimed that the government’s stake is a “common arrangement” under Chinese law and “has no bearing on ByteDance’s global operations, including TikTok.”