A handful of US financial and tech tycoons are preparing multibillion-dollar bids to buy TikTok after President Joe Biden signed a law that would force its Chinese owners to sell the app.
First up is Steven Mnuchin, the former Treasury Secretary who has openly said he wants to buy the app.
Suitors also include former Activision Blizzard CEO Bobby Kotick, who has reportedly spoken to OpenAI CEO Sam Altman about a possible proposal.
And there is speculation that Pershing Square hedge fund chief Bill Ackman could make a bid as well. Even “Shark Tank” multi-millionaire Kevin O’Leary has said he’d “like to buy” TikTok.
ByteDance has one year to delist TikTok or ban the app altogether.
However, China’s commerce ministry said last year that it would have to approve TikTok’s divestment from parent company ByteDance — and that it strongly opposed any sale.
The potential buyer would only get a brand and a user base and would have to rebuild the technology and the team building it from scratch.
Any buyer must pass scrutiny from regulators, including the Federal Trade Commission, where Biden appointee Lina Kahn has led a crackdown on what she sees as monopolistic practices by big tech companies.
That rules out Mark Zuckerberg’s Meta and Tim Cook’s Apple, who could afford a $100 billion price tag and have the expertise to build a new algorithm.
But a purchase by them would be “very problematic,” an antitrust expert told The Post.
“Every one of these companies is subject to ongoing antitrust actions,” Joel Thayer, principal at antitrust consulting and law firm Thayer PLLC told The Post.
“It would be nearly impossible for a company already under antitrust scrutiny to buy a company that would give it more power and market share.”
Even Evan Spiegel’s Snap, SnapChat’s parent company, which has a market capitalization of just $18 billion, could raise antitrust concerns, he said. For Snap, funding would also be much more difficult.
A source close to TikTok told The Post, “No tech company in the US could buy TikTok through regulators. So you take a step back and there aren’t as many people who can do the financing, convince the board and build the company.”
Mnuchin was the first interested buyer to say so publicly, telling CNBC in March that he was “putting together a group of investors who could buy the app” through his Liberty Strategic Capital fund.
After decades in banking and raising money for hedge funds, and even movies like Avatar, he has investment experience.
If Trump is elected, Mnuchin could also rejoin the White House as Treasury secretary, which would take him away from the company, sources told The Post. Mnuchin declined to comment on that possibility.
But Kotick may be best placed to actually build an algorithm and build a tech company, sources told The Post.
In March, the Wall Street Journal reported that Kotick had spoken with potential investors, including OpenAI CEO Sam Altman, about finding a consortium that could buy the deal.
The maker of ChatGPT could use TikTok to help train its AI models if a partner like Kotick could raise the massive amount of capital needed to get any deal done.
He was the founder and CEO of gaming giant Activision Blizzard which created and manufactured apps and games, until he brokered its $69 billion sale to Microsoft.
He developed relationships with deep-pocketed investors, sources told The Post. Kotick declined to comment.
Although Ackman has not indicated an interest in TikTok, Wall Street sources say he could use a special finance vehicle he created last year as a way to raise money quickly.
The so-called SPARC is a publicly traded financial vehicle that can raise an unlimited amount of money and use it to buy a private company like TikTok.
Ackman’s hedge fund has already committed about $3.5 billion as a lead investor in the fund, but he and his fund could inject more capital if needed, the sources added. He declined to comment.
Jeffre Yass and a woman celebrating a $500,000 prize for being ‘unlicensed’ in education
Beltway sources speculate that another potential buyer is Jeffrey Yass, the founder of Susquehanna who is worth $30 billion.
It already owns 15% of ByteDance — and sources say it has the cash to buy a bigger stake in TikTok.
These people add that after Yass’ serious effort to stop the bill, including accusations of intimidating members of Congress and meeting with former President Trump, Yass may now back off on his divestiture.
A recent report even suggested that Susquehanna may have an early version of the algorithm that would give it a technological advantage.
The company’s deep ties to ByteDance and China put it in a position to convince the board and the government that it should acquire the app, these people added.
Larry Ellison, CEO of Oracle Corp, introduces the Oracle In-Memory Database at a launch event in Redwood Shores, California, June 10, 2014
A handful of other buyers — who had lined up to buy TikTok in 2020 when Trump tried to force a sale — could also come forward in the coming months to buy it.
Walmart CEO Doug McMillon has been in talks to partner with software giant Oracle to buy TikTok’s US operations.
While this failed, McMillon maintained contact with the company. Zhang flew to Arkansas for a meeting with McMillon last year, The Post reported, leading to speculation that he could still be interested.
Oracle founder Larry Ellison hasn’t said anything about the TikTok market since 2020. However, the company is already hosting US TikTok users’ data on its servers.
And “Shark Tank’s” O’Leary told CNBC Asia in March that he would put together a consortium to bid $20 billion to $30 billion to buy TikTok.
Microsoft, founded by Bill Gates, also tried to buy TikTok in 2020, but sources say it is unlikely to get involved again.
Representatives for Walmart, TikTok and ByteDance did not immediately respond to a request for comment.
Whether it is actually granted or banned remains to be seen. On Wednesday, TikTok CEO Shou Zi Chew assured users that the app was “not going anywhere” and that the company would pursue legal action to prevent a ban or divestiture — which could at least delay the sale .
Other sources note that if Trump — who recently said he opposed banning TikTok — is elected, he could try to engage in negotiations for a sale as he did in 2020 or try to stop a forced divestiture.
