Amid an impending ban on U.S. operations of TikTok, Twitter has expressed interest in acquiring the service, according to a new report from The Wall Street Journal.
The report explains that it is not immediately obvious why Twitter is interested in purchasing TikTok, given the cost of acquisition and the need for substantial restructuring. Twitter's comparatively small size would, however, likely please antitrust investigators.
Twitter has a market capitalization of around $30 billion, which is almost as much as the valuation of TikTok's available assets, and would need to raise substantial additional capital. Twitter is therefore thought to be unable to finance a large enough bid to displace Microsoft as the front-runner, particularly before the deadline to complete a sale set out by President Trump.
Private equity company Silver Lake, a major Twitter shareholder, is said to be interested in helping to fund a deal. Twitter declined to comment to The Wall Street Journal.
In spite of the talks, Microsoft is still believed to be the front-runner in negotiations to purchase TikTok. Twitter has apparently made the case that its bid would be preferable to Microsoft's since it would not face any pressure from China since it has no current business in that country, unlike Microsoft.
The discussions between TikTok's Chinese parent company ByteDance and Microsoft are supposed to complete no later than September 15, and negotiations are still preliminary. Microsoft has said that it will not provide a further update until there is a definitive outcome.
Twitter previously acquired the short-form video sharing app "Vine" in 2012, but eventually closed the service four years later. TikTok operates similarly to Vine, and comparisons are often drawn between the services.
President Donald Trump signed two executive orders on Friday that set about banning any U.S. transactions with Chinese tech companies, and expressed his will to ban TikTok if it was not acquired by a U.S. company. TikTok is now reportedly planning to sue the Trump administration as soon as Tuesday, in a direct challenge to the president's executive order.
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Top Rated Comments
How is the US a 'free market' and 'free country' again? Someone remind me?
Shall we force-sale Facebook Germany to a local company there now too?
How about France forces Twitter to sell to a local company there?
Simultaneously, it is constantly attacking the economy by abusing executive order and national security scheme regardless if there are any documentation of evidence and it resulted in U.S. company to lose billion of dollars.
The American economy is not improving by any means and absolutely not an exaggeration to view it as ”The art of the failure” throughout the presidency.
:P