Daily US Times: Twitter shares rose as much as 5% Monday after it reportedly held preliminary talks with the popular Chinese social media app TikTok. The micro-video platform gets troubled after the Trump administration said that it wants to ban the app.
By midday, the stock was up just 1.5%, but the broader Nasdaq stock index had fallen by nearly 1%.
The Wall Street Journal said on Saturday that the deal would involve TikTok’s US operations, but it’s unclear if Twitter will move forward with an acquisition. The immensely popular Chinese app is reportedly worth tens of billions of dollars, which sparks questions and doubts about whether Twitter, which has a market cap of around $30 billion, can afford the app.
Twitter (TWTR) didn’t comment about the development yet.
If it’s able to come up with the resources to buy TikTok, Twitter’s small size could alleviate antitrust concerns. Twitter previously owned Vine, another video app, but it closed down in 2017.
Microsoft (MSFT) said last week that it’s pushing forward with talks to acquire TikTok following a conversation between President Donald Trump and CEO Satya Nadella. The transaction could be difficult to accomplish and complicated. And in recent years, Microsoft has shifted its strategy away from consumers toward businesses.
A deal would create a new structure in which Microsoft would own and operate TikTok services in the United States, Australia, New Zealand and Canada. As part of the agreement, Microsoft said it would ensure that all private data of TikTok’s American users would be transferred to and remain in the United States.
Microsoft said that “in any event” it would finish talking with ByteDance, the owner of TikTok, no later than September 15. That’s the date Trump set as the deadline for the Chinese app to find a US buyer. Mr Trump said, failing to do so would lead him to shut down the app in the country.
TikTok has come under fire as a consequence of US deteriorating relations with China. Trump administration repeatedly said the app is collecting private data of American citizens which they could later use to blackmail, a claim TikTok rejected. TikTok said they are committed to the safety of users’ data and they stored American users’ in servers kept in the US.
TikTok is also facing challenges in India, its biggest market, after the Indian government banned the app after border clash with China, which left 20 Indian soldiers dead.
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