Chinese officials consider selling TikTok US to Elon Musk.
Chinese officials are considering a scenario where Elon Musk could acquire TikTok’s US operations if the app faces a ban in the United States. As per Bloomberg, the Chinese government prefers that TikTok remains under the ownership of its parent company, ByteDance Ltd. However, TikTok is currently appealing a potential ban to the US Supreme Court, which seems likely to uphold the law.
Discussions among senior Chinese officials have included various contingency plans regarding TikTok, particularly in light of the incoming Trump administration. One option involves Musk, who has previously supported Trump financially. A deal with Musk could be appealing to China, as he is seen as a close ally of Trump and could help facilitate negotiations.
One idea discussed is for Musk’s platform, X (formerly Twitter), to take control of TikTok’s US operations. This could enhance X’s advertising reach, given TikTok’s 170 million US users. Additionally, Musk’s AI company, xAI, could benefit from TikTok’s data.
Musk previously tweeted about the TikTok ban in April last year. He said, “In my opinion, TikTok should not be banned in the USA, even though such a ban may benefit the 𝕏 platform. Doing so would be contrary to freedom of speech and expression. It is not what America stands for.”
Chinese officials have not reached a final decision on how to proceed, and it is unclear how much ByteDance knows about these discussions. There has been no communication between Musk, TikTok, and ByteDance regarding any potential deal.
Musk has publicly stated that he believes TikTok should not be banned in the US, arguing that such a ban would contradict American values of free speech. Meanwhile, representatives from ByteDance and TikTok have not commented on the situation, nor have Chinese government agencies involved in the decision-making process.
The Chinese government holds a “golden share” in ByteDance, which gives it some influence over the company’s operations. However, ByteDance maintains that this control does not extend to its operations outside of China. The Chinese government’s export rules complicate any potential sale of TikTok, particularly regarding its algorithms.
Analysts estimate TikTok’s US operations could be valued between $40 billion and $50 billion, a significant amount even for Musk. It remains uncertain how Musk could finance such a deal or if it would require selling other assets. Musk previously acquired Twitter for $44 billion and is still managing substantial debts.
Musk is viewed positively by many ByteDance employees, as he has successfully engaged with the Chinese government through his Tesla business. ByteDance’s leadership is focused on contesting US legislation that could force the sale or shutdown of TikTok due to national security concerns.
The Supreme Court justices have indicated that they may prioritize security concerns over free speech in their upcoming decision. President-elect Trump has expressed a desire to delay the TikTok ban to negotiate a solution, suggesting he wants to “save” the app.
Separating TikTok’s US operations would be complex and could impact shareholders in both China and the US. There are discussions about whether a sale would be competitive or government-arranged. Other potential bidders include billionaire Frank McCourt and investor Kevin O’Leary, who have shown interest in acquiring TikTok.
Another option for TikTok could be to transition US users to a different app to avoid the ban, although the effectiveness of this strategy is uncertain. Despite the looming legal battle, TikTok executives prefer to continue fighting in the US rather than selling the US operations and losing control.
Musk’s unique position allows him to influence US-China relations, given his significant business interests in both countries. His Tesla factory in Shanghai has helped the company gain market share in China and build goodwill with local officials, despite the challenging competitive landscape.
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According to different sources, Chinese refuted the claims saying, “Hard pass” to Elon Musk.
