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TikTok Parent ByteDance’s Valuation Rises to About $300 Billion

Investors see Trump victory as a positive with the threat of TikTok ban looming in U.S.

TikTok has been caught in the crosshairs of escalating geopolitical tension between the U.S. and China. Photo: Bing Guan/Bloomberg News

TikTok has been caught in the crosshairs of escalating geopolitical tension between the U.S. and China. Photo: Bing Guan/Bloomberg News

TikTok parent ByteDance is valuing itself at about $300 billion, one of its highest valuations ever, even as the Chinese tech giant’s popular TikTok app faces the prospect of a looming ban in the U.S.

The details

The valuation came in a recent buyback offer by ByteDance, according to people familiar with the offer, and suggests the company expects its growth to continue. A law signed by President Biden earlier this year would ban TikTok in the U.S. unless ByteDance divests itself of the app by mid-January.

The company’s valuation has ticked higher in share buybacks over the past year as ByteDance has continued to grow at a rapid pace globally. ByteDance valued itself at nearly $225 billion in a tender offer to employees in October 2023. A buyback in December 2023 boosted its valuation to $268 billion, according to a company email to investors seen by The Wall Street Journal. 

ByteDance investors have viewed President-elect Donald Trump’s return to the White House as an overall positive for TikTok’s hopes in the U.S. Trump had supported a ban of the app as president, but reversed his stance during his recent campaign after meeting with billionaire Jeff Yass, a major ByteDance investor and GOP megadonor. Trump has said he and Yass didn’t discuss TikTok, as did a person close to Yass. It is unclear how much Trump can affect the law’s outcome.Proponents of the law say it would prevent the Chinese government from spying on Americans or influencing the content TikTok users see. TikTok has said it wouldn’t comply with such interference from the Chinese government.

The background

ByteDance in recent days told investors it was looking to buy back shares at about $180 a share. Raising money for buybacks has become a popular way for companies to give liquidity to investors and early employees while the market for initial public offerings remains chilled. 

ByteDance owns a number of businesses besides TikTok, including popular internet services in China. In the U.S., TikTok has been caught in the crosshairs of escalating geopolitical tension between the U.S. and China. 

Concerns about the national security threat TikTok poses to the U.S. culminated in April when Biden signed the law that could ban the app. TikTok Chief Executive Shou Zi Chew has said the app isn’t going anywhere, and in May, TikTok filed a federal lawsuit arguing the law violates the free-speech rights of its users.

Several billionaires had announced plans to bid for TikTok, but ByteDance has said it can’t and won’t sell TikTok’s U.S. operations.

Corrie Driebusch and Georgia Wells contributed to this article.

Write to Juliet Chung at Juliet.Chung@wsj.com and Raffaele Huang at raffaele.huang@wsj.com

Author: Editors Desk

Source: WSJ:

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