TikTok’s parent company, ByteDance, recently approached investors about a share buyback program and now values itself at around $300 billion, according to two people familiar with the matter.
TakeAway Points:
- TikTok’s parent company, ByteDance, is valuing itself at about $300 billion after it recently approached investors about a share buyback program.
- This is the third buyback program for investors from Bytedance, which has been conducting share buybacks since 2022.
- Trump’s return to the White House, though, may provide a lifeline for Chew and TikTok.
TikTok’s parent company is valued at $300 billion
ByteDance reached out to investors in recent weeks, offering a price of $180.70 per share, the people said.
The current offer price is an increase of 12.9% from the per share price of $160 in their last buyback program.
The news about the valuation was earlier reported by the Wall Street Journal.
ByteDance did not have any IPO plan in sight, one of the sources said, adding that the buyback program is a way to provide Bytedance with liquidity.
This is the third buyback program for investors from Bytedance, which has been conducting share buybacks since 2022.
The company in Dec 2023 offered to buyback around $5 billion worth of shares from investors at a price of $160 each, which valued the company at $268 billion.
ByteDance had been planning to carry out the buyback program regardless of the outcome of the U.S. presidential election, another source said, declining to be identified.
ByteDance, whose global revenue grew 30% last year to $110 billion, has been facing a legal battle over its U.S. assets.
A law signed by U.S. President Joe Biden on April 24 gives ByteDance until Jan. 19 to sell TikTok or face a ban. The White House has said it wants to see Chinese-based ownership ended on national-security grounds but not a ban on TikTok.
TikTok and ByteDance sued in U.S. federal court in May, seeking to block the law signed by Biden.
Trump’s victory may provide TikTok a lifeline to remain in the U.S.
After Donald Trump won the U.S. presidency last week, tech CEOs including Apple’s Tim Cook, Meta’s Mark Zuckerberg, and Amazon’s Jeff Bezos publicly praised the president-elect.
One name was conspicuously missing: TikTok CEO Shou Zi Chew.
His absence was notable considering that of all the top tech companies, TikTok faces the most immediate and existential threat from the U.S. government. In April, President Joe Biden signed a law that requires China’s ByteDance to sell TikTok by Jan. 19. If ByteDance fails to comply, internet hosting companies and app store owners such as Apple and Google will be prohibited from supporting TikTok, effectively banning it in the U.S.
Trump’s return to the White House, though, may provide a lifeline for Chew and TikTok.
Although both Republicans and Democrats supported the Biden TikTok ban in April, Trump voiced opposition to the ban during his candidacy. Trump acknowledged the national security and data privacy concerns with TikTok in a March interview with CNBC’s “Squawk Box,” but he also said “there’s a lot of good and there’s a lot of bad” with the app.
Trump also leveraged TikTok’s shaky future in the U.S. as a reason for people to vote against Democrat Vice President Kamala Harris.
“We’re not doing anything with TikTok, but the other side is going to close it up, so if you like TikTok, go out and vote for Trump,” the president-elect said in a September post on his Truth Social service.
Since his election, Trump hasn’t publicly discussed his plans for TikTok, but Trump-Vance transition spokeswoman Karoline Leavitt said that the president-elect “will deliver.”
“The American people re-elected President Trump by a resounding margin giving him a mandate to implement the promises he made on the campaign trail,” Leavitt said in a statement.
Trump’s rhetoric on TikTok began to turn after the president-elect met in February with billionaire Jeff Yass, a Republican megadonor and a major investor in the Chinese-owned social media app.
Yass’s trading firm Susquehanna International Group owns a 15% stake in ByteDance, while Yass maintains a 7% stake in the company, equating to about $21 billion, NBC and CNBC reported in March. That month it was also reported that Yass was a part owner of the business that merged with the parent company of Trump’s Truth Social.
If ByteDance doesn’t sell TikTok by the January deadline, Trump could potentially call on Congress to repeal the law or he can introduce a more “selective enforcement” of the law that would essentially allow TikTok to continue operating in the U.S. without facing penalties, said Sarah Kreps, a Cornell University professor of government. “Selective enforcement” would be akin to police officers not always enforcing every single instance of jaywalking, she said.
At TikTok, meanwhile, Chew has remained quiet since Trump’s victory, just as he had been in the lead-up to Election Day.
The Chinese-owned company may be taking a neutral approach and a wait-and-see strategy for now, said Long Le, a China business expert and Santa Clara University associate teaching professor.
Le said it’s hard to foresee what Trump will do.
“He’s also a contrarian; that’s what makes him unpredictable,” Le said. “He can say one thing, and the next year he’ll change his mind.”
