Yahoo News Microsoft Hopes To Clinch TikTok Acquisition By Mid-September With U.S. Government Approval
Microsoft said Sunday evening it will continue to pursue a takeover of TikTok in the U.S. as President Donald Trump backs off of threats to ban the service, a development that could see the software giant running the hugely popular video sharing app by mid-September.
The Redmond, Washigton-based company announced its intentions following a conversation between Microsoft CEO Satya Nadella and President Trump, who had threatened to ban the Chinese–owned TikTok as early as this weekend over data security concerns.
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“Microsoft fully appreciates the importance of addressing the President’s concerns. It is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury,” Microsoft said in a post on its corporate blog.
“Microsoft will move quickly to pursue discussions with TikTok’s parent company, ByteDance, in a matter of weeks, and in any event completing these discussions no later than September 15, 2020. During this process, Microsoft looks forward to continuing dialogue with the United States Government, including with the President.”
TikTok is owned by Beijing-based conglomerate ByteDance, which launched a U.S. version of the app after acquiring U.S company Musical.ly in 2017.
Microsoft and ByteDance had pitched the possibility to the Committee on Foreign Investment in the United States (CFIUS), which reviews foreign acquisitions of U.S. companies and had been scrutinizing TikTok. The preliminary proposal would involve acquiring the TikTok service in the U.S., Canada, Australia, and New Zealand, where Microsoft would own and operate TikTok.
Microsoft may invite other American investors to participate on a minority basis in this purchase.
“This new structure would build on the experience TikTok users currently love, while adding world-class security, privacy, and digital safety protections. The operating model for the service would be built to ensure transparency to users as well as appropriate security oversight by governments in these countries,” Microsoft said.
Among other measures, Microsoft said it would ensure that all private data of TikTok’s American users is transferred to and remains in the U.S. To the extent that any such data is currently stored or backed-up outside the country, Microsoft would ensure that this data is deleted from servers outside the country after it is transferred.
Threats to ban the service have been escalating. On Saturday, a Whilte House spokesperson said, “The administration has very serious national security concerns over TikTok. We continue to evaluate future policy.”
TikTok fired back with: “These are the facts: 100 million Americans come to TikTok for entertainment and connection, especially during the pandemic. We’ve hired nearly 1,000 people to our US team this year alone, and are proud to be hiring another 10,000 employees into great paying jobs across the US.” The company has defended itself even as it looked for ways to defuse the growing tenions, including hiring an American CEO — former Disney executive Kevin Mayer in May — and exploring a shift in its headquarter outside of China.
Microsoft cautioned that the talks are preliminary and there can be no assurance that a transaction will proceed. It said it doesn’t intend to provide further updates until there’s a definitive outcome.
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