How much could buying TikTok cost Elon Musk?

2025-01-15 17:28:41 / TRENDING ALFA PRESS

How much could buying TikTok cost Elon Musk?

Elon Musk, the world's richest person, could make a bid similar to what he paid for Twitter ($44 billion) if he reaches a deal to buy TikTok's US operations. The potential move is part of a debate that has taken on new hues as China is reportedly considering facilitating a sale to Musk to avoid a full ban on TikTok in the United States.

ByteDance, the Chinese company that owns TikTok, could ask for between $40 billion and $50 billion to sell the app’s U.S. operations. That’s very similar to what Musk paid for Twitter in 2022—$44 billion—and well beyond the roughly $20 billion offer made by U.S. consortium Project Liberty last week to buy TikTok.

Dan Ives, a prominent analyst at Wedbush, says this could be a “great buy” for Musk and his social media company, X (formerly Twitter). Ives, who covered Twitter when it was a public company and now covers Tesla and the US tech industry, believes TikTok is a tremendous asset that could help X strengthen its position in the global social media market. TikTok has gained immense popularity, with about a third of Americans using it, surpassing X, which is used by 21% of Americans. Another factor that could influence this deal is Musk’s close relationship with US President-elect Donald Trump. This factor has raised some questions about the possibility of a deal facilitated by Chinese authorities to prevent a potential ban on TikTok in the US. If the deal to buy TikTok becomes a reality, it would have to go through a complicated regulatory process related to concerns about the security of US users’ data. US lawmakers have expressed concerns that the Chinese government could be able to request data from TikTok about its US users, which could impact national security. These concerns have led to calls for a ban on TikTok in the US unless ByteDance sells the platform to a US entity.

ByteDance is facing a tough situation, as TikTok could be banned on Sunday if it doesn't sell its U.S. operation. However, the Supreme Court's decision on an appeal of the ban could bring a delay, and Trump may be able to extend the deadline by 90 days after his inauguration on Monday.

Against this backdrop, the Project Liberty consortium, led by billionaire Frank McCourt, former owner of the Los Angeles Dodgers, is one of the leading bidders to buy TikTok. The consortium is one of the leading options to acquire TikTok's US operations, but their $20 billion offer is still below the valuation Musk could offer.

Other American billionaires are also involved in the story, including Jeff Yass, who is a major shareholder of ByteDance and one of the potential invitees to contribute to a potential deal to acquire TikTok. Yass is an investor and key figure in the firm Susquehanna International Group, which has a 15% stake in ByteDance.

In this murky and international dynamic, a potential acquisition of TikTok by Musk would help solidify his position in the social media industry, giving him the opportunity to compete with other major platforms like Meta and Google. It could also bring about significant changes to how TikTok operates and is regulated in the U.S. and around the world, opening up new opportunities for Musk in a sector he already dominates with X.

Ultimately, this is a story that will have its own major ramifications for the social media market and could serve as a pivotal moment in determining the future path for TikTok and other tech companies that are involved in this ongoing drama.

 

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