Another Busy Week for TikTok
TikTok’s CEO Steps Down
Kevin Mayer, the CEO of TikTok, announced that he is resigning less than four months after he joined the company. Mayer was also the Chief Operating Officer of ByteDance, TikTok’s parent company. Before accepting the role at TikTok, he was the top streaming executive at Disney (DIS).
TikTok hired Mayer as part of a push to bring more of its management to the US due to scrutiny from the Trump Administration. Yet sources told the Financial Times that Mayer, “did not anticipate the extent to which TikTok would become involved in tensions between China and the US,” and “didn’t sign up for this.” General Manager of TikTok Vanessa Pappas will now step in to serve as interim head of the wildly popular video application.
Conflicts With the White House
Earlier in August, President Trump signed an executive order stating TikTok would be banned in the US unless its US operations were sold to a domestic company within 45 days. The initial 45-day deadline then got extended to 90 days, which means the deadline is now November 12.
Earlier this week, ByteDance sued the US government, saying that forcing it to sell its US operations through an executive order deprived the company of due process. However, it is still very likely that TikTok’s US, Canadian, Australian, and New Zealand operations will be sold. A number of buyers have been vying for the deal for some time. It now seems that TikTok could announce an agreement as soon as next week.
TikTok on the Clock
TikTok has been approached by multiple companies over the past few weeks. Most notably it is negotiating with Microsoft (MSFT) and Oracle (ORCL) about the possibility of an acquisition. Alphabet (GOOGL), Google’s parent company, was also involved in talks earlier this week, but the discussions appear to be dead. Twitter, who was reportedly another contender, is also now at the bottom of the list.
Most recently, Walmart (WMT) joined the conversation yesterday, and could make a bid for TikTok’s US business in partnership with Microsoft. Although Walmart’s entry into the field was somewhat confusing, the retailer already works with Microsoft on several technology projects, including cloud computing, as the two aim to compete with Amazon (AMZN).
TikTok has not decided on a price tag, but it is expected that the deal will fall within the $20 billion to $30 billion range. TikTok users and investors will be following the twists and turns to see how these negotiations unfold—potentially in the very near future.
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