Decision on TikTok’s US operations expected soon

ByteDance may go public on a U.S. stock exchange to address ownership concerns

US President Donald Trump is expected to decide on TikTok’s fate in the U.S. in the next 24-36 hours.

To address ownership concerns, ByteDance plans to do an initial public offering of global TikTok on a U.S. stock exchange, according to people familiar with the matter. Oracle will also own a minority stake that will be less than 20 percent of the new global TikTok, two of the people said. Walmart will also take a stake, though its size is still unknown, according to two of the people.

The Treasury Department sent major revisions about security issues on the TikTok/Oracle term sheet Wednesday night, sources told CNBC. ByteDance has fully agreed to those revisions, the sources said, although it’s unclear what the changes entailed.

Trump has been meeting with advisers as he decides whether or not to approve the deal, according to others familiar with the matter, who asked not to be named because the talks are private. There are mixed points of views among his advisers, who include Secretary of State Mike Pompeo and Secretary of Treasury Steve Mnuchin, one of the people said.

An initial public offering of TikTok would likely be the largest technology IPO in recent years. Private valuations of the company have been estimated to be about US$50 billion. Recent public offerings, such as Snowflake, have added billions of dollars in valuation when stocks hit the public markets.

I set a date of around Sept. 15 at which point it’s going to be out of business in the United States, Trump said in an Aug. 3 news conference. So it’ll close down on Sept. 15 unless Microsoft or somebody else is able to buy it and work out a deal, an appropriate deal, so that the Treasury of the United States gets a lot of money.

Chinese officials would also have a say in any potential deal involving TikTok, which could further complicate any resolution.

While ByteDance plans to keep the company together as a publicly traded company, there will be a new U.S. board of directors for American operations. Walmart CEO Doug McMillon is expected to have a seat on the newly formed board of directors for TikTok’s U.S. operations. Walmart declined to comment.

Trump on Wednesday also backed off his desire to demand “key money” from allowing the transaction, saying his lawyers told him it was illegal.