ByteDance says it will own a majority of TikTok. But Oracle says ByteDance will own 0%. One of the strangest M&A processes!
China’s ByteDance confirms that it will retain an 80% stake in TikTok after selling a total of 20% to Oracle, its ‘trusted technology partner,’ & Walmart, its ‘commercial partner’.This means that Oracle is taking only 12.5% in TikTok Global, & Walmart will take 7.5%. The #deal terms would value TikTok at about $60B!. President Donald Trump has been arguing that TikTok must be completely controlled by Americans.
“TikTok” the app is going to be housed in a new company called #TikTok Global, which will be located outside of China. TikTok’s recommendation algorithm has been a key driver behind its growth. It helps to suggest other videos to users to keep them hooked. Hence, ByteDance is adamant about transfering algorithms & technologies to Oracle
Although it will become TikTok’s secure cloud provider & host U.S. user data. ByteDance is 40% owned by U.S. VC firms, so the Trump administration can technically claim that TikTok Global is now majority-owned by U.S. money
Do you think Bytedance will give its full ownership of Tiktok to the Trump administration, Oracle & Walmart or will the parties come to a mutually beneficial decision?