Foreign media quoted people familiar with the matter as saying that Twitter Inc. has conducted preliminary negotiations on a potential merger with Chinese video-sharing app TikTok .
People familiar with the matter said that it is unclear whether Twitter will seek a deal with TikTok’s US business. Because Twitter is much smaller, the San Francisco-based social media company believes that it may not face the same level of antitrust scrutiny as Microsoft (212.48, -3.87, -1.79%) or other potential bidders. .
People familiar with the matter said that Microsoft has negotiated for several weeks with TikTok’s owner, Beijing-based ByteDance Co., Ltd., and is considered to be the leader in any deal that may be concluded. A week ago, Microsoft CEO Satya Nadella had a conversation with President Donald Trump on the matter.
A TikTok spokesperson said in response to inquiries about the report that the company will not comment on “market rumors .”
Twitter’s market value is about 29 billion US dollars, lower than Microsoft’s market value of more than 1.6 trillion US dollars. According to the report, if Twitter does acquire TikTok, it will almost certainly need the help of other investors, but the private equity firm Silver Lake is also one of Twitter’s investors.
Twitter CEO Jack Dorsey tried to produce short videos, but failed: To cut costs, Twitter closed the app in 2016, four years after acquiring Vine. The company was recently attacked by President Trump, who said that Twitter and Facebook (268.44, 3.16, 1.19%) Inc. were censoring him unfairly. Both platforms blocked a video shared by accounts related to Trump because the video violated their policy on false information about the coronavirus.
U.S. National Public Radio reported earlier on Saturday, citing anonymous sources, that TikTok plans to file a federal lawsuit as early as next Tuesday to challenge President Trump’s executive order prohibiting the video sharing service from entering the United States is unconstitutional. On Friday, TikTok responded to the ban in a blog post, saying it was “shocked” and would seek all available remedies.
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