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ByteDance Receives Two-Week Grace To Negotiate Deal On TikTok
This week, the deadline for agreeing on the terms of a deal to transfer control over the American business of TikTok to a consortium of American companies approached. This initiative was promoted by Donald Trump, but the struggle for power in the United States somewhat distracted him from this issue. ByteDance received a two-week grace period until November 27.
Image source: Reuters
A similar decision was made by the Committee on Foreign Investment in the United States (CFIUS), according to news agencies Reuters and Bloomberg. In conjunction with the cancellation of the decree on the suspension of US users’ access to the TikTok service, this will allow the Chinese company ByteDance to continue serving the interests of American customers until the end of November, at least.
During the court hearing, which culminated in the adoption of a decision to increase the timing of the deal, ByteDance representatives complained about the lack of feedback from the American authorities to the attempts of the Chinese company to reach a compromise that would help avoid the sale of the American part of TikTok’s business. During the entire discussion of the transaction, representatives of TikTok have already submitted four proposals on the possible structure of the transaction. Its latest option involves participation in the buyout of TikTok assets in the United States of Walmart, Microsoft and the existing American shareholders of ByteDance.
Recall that at one time it was the discrepancies in the interpretation of the share capital structure that led to the postponement of the transaction approval. The American side believes that the participation of ByteDance in the capital of TikTok Global is unacceptable in any case, and the Chinese side claims that the presence of American investors among the owners of the assets of the parent company automatically increases the degree of US influence to the required level. The Chinese authorities also have their own requirements – they seek to prevent the transfer of the TikTok recommendation algorithm under the control of American companies.