As Walmart Expresses Interest, New Chinese Regulations Could Thwart TikTok Sale

Walmart has said that they would join Microsoft to buy TikTok. However, new export rules in China could thwart the social media platforms sale altogether.

The possible sale of TikTok has been a story filled with twists and turns. Microsoft expressed interest in buying the US operations early on. Unfortunately, things grew complicated when impeached US president, Donald Trump, stepped in. He signed an executive order saying that TikTok would be banned from the US unless it is owned by an American entity. In response, TikTok threatend, then ultimately filed a lawsuit against the president. TikTok employees separately filed a lawsuit against the impeached president as well citing lost wages.

In the midst of all of this president induced chaos, Walmart expressed interest in buying TikTok as well. The idea is that they will team up with Microsoft in a bid to purchase the US operations late last month. From CNBC:

Walmart said Thursday that it’s teaming up with Microsoft in a bid for TikTok.

The retail giant confirmed to CNBC that it’s interested in buying the popular short-form video application.

TikTok’s Beijing-based parent company, ByteDance, is nearing an agreement to sell its U.S., Canadian, Australian and New Zealand operations in a deal that’s likely to be in the $20 billion to $30 billion range, sources say. It has not yet chosen a buyer, but could announce the deal in coming days, the sources say.

With Walmart’s confirmation, it joins several others trying to acquire the tech company, including Oracle.

Walmart spokesman Randy Hargrove declined to say how the two companies would split ownership of TikTok, if they had the winning bid, and whether the retailer would be the majority owner.

As the story began to look like everyone was lining up to buy TikTok, a new development occurred that some say could thwart the sale altogether. China is tightening technology export rules. The new rules suggest that China would have the final say on what can and cannot be sold. From CNBC:

An updated export rule from China could jeopardize the sale of TikTok’s U.S. operations, according to reports published Saturday in The Wall Street Journal and The New York Times.

According to the reports, China updated its export control rules to incorporate technology that could include TikTok, a claim later reasserted by commentary published in China’s state-controlled Xinhua news agency on Saturday.

Cui Fan, a professor of international trade in Beijing, told Xinhua that ByteDance would probably have to get approval from the Chinese government and suggested the company may have to suspend negotiations on TikTok’s sale.

This opens up the possibility that the sale of TikTok could ultimately fall through. As a result, the story could fall back onto where the TikTok lawsuits against the presidents executive order could go. The question about whether or not the president can even ban TikTok from the US becomes a much more relevant question.

In a story with many twists and turns, we can certainly add one more in this ever growing saga.

Drew Wilson on Twitter: @icecube85 and Facebook.



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