Is Tik Tok app worth $ 60 billion?
ByteDance, the owner of the TikTok app, has placed a valuation of $ 60 billion after agreeing to buy Oracle and Walmart stakes in the short video app to meet US requirements for security concerns, according to informed sources.
Oracle and Walmart each have the right to buy 12.5% and 7.5%, respectively, of the new global entity TikTok, according to an agreement that won the approval of US President Donald Trump. It is expected that the US companies will both pay $ 12 billion for the 20% stake in the company, if they accept that price.
Sources said that the final price of the deal has not yet been determined, as the partners are currently working on the ownership structure and standards for data security, according to a source quoted by Bloomberg.
Beijing has not yet agreed to the deal, but said it would be with any agreement in which ByteDance could keep its valuable stock and technology used in the application.
The evaluation of TikTok has been a subject of controversy during the last period, as the evaluation of the company’s operations in the United States ranged between 20 and 50 billion dollars, or more. And for similar companies, Snap’s market value was about $ 35 billion.
ByteDance said in a statement on Saturday that it had prepared an agreement with Oracle to be its technology provider in the United States and Walmart to be the trading partner, a day before a federal ban on the Chinese company that owns the app takes effect.
A company spokesman said, “We are pleased that the offer by TikTok, Oracle and Walmart will solve the security concerns of the US administration and end questions about the future of TikTok in the United States.”
The spokesman added that Oracle will become “the reliable technology provider responsible for hosting data for all users in the United States and securing the associated computing systems to ensure that all US national security requirements are fully met.” “We are also currently working with Walmart on a business partnership.”
The United States banned the download of the popular Chinese short video recording app due to it being considered a threat to national security, which led to an escalating conflict with China over technology.
About 100 million Americans use TikTok. US officials have expressed concern about user data and China’s ability to obtain that data.