Walmart Announces That It Is Partnering With Microsoft To Acquire TikTok
Retail behemoth Walmart has announced that it is partnering with Microsoft in its bid for the US operation of TikTok, the popular Chinese video-sharing application, The Wall Street Journal reported.
In an official statement on its joint bid with Microsoft to acquire TikTok service in the United States , the world’s largest retailer said
“The way TikTok has integrated e-commerce and advertising capabilities in other markets is a clear benefit to creators and users in those markets. We believe a potential relationship with TikTok U.S. in partnership with Microsoft could add this key functionality and provide Walmart with an important way for us to reach and serve omnichannel customers as well as grow our third-party marketplace and advertising businesses.”
The company also said that the Microsoft partnership would meet both the expectations of U.S. TikTok users while satisfying the concerns of U.S. government regulators. The Trump administration had indicated that it wants TikTok’s U.S. operations to be owned by an American company with deep tech expertise.
Walmart and Microsoft have established a long standing partnership on several technology projects, with the retailer using Microsoft’s cloud computing services,
On Aug 6, US President Donald Trump ordered ByteDance to divest the US operations of its video-sharing app TikTok within 90 days. The presidential order stated that data collection by the company threatens to allow the Chinese Communist Party access to Americans’ personal and proprietary information — potentially allowing China to track the locations of Federal employees and contractors, build dossiers of personal information for blackmail, and conduct corporate espionage.
According to the WSJ report, Microsoft’s joint bid with Walmart is considered the front-runner for the proposed deal . The closure of deal is still considered a challenge as TikTok’s Chinese owner ByteDance Ltd has pegged the valuation of its U.S. operations at $30 billion.
Also in the race to acquire TikTok is Larry Ellison led enterprise software giant Oracle. The company held preliminary talks with TikTok’s parent company ByteDance. Oracle bidding it jointly with venture capital firms including General Atlantic and Sequoia Capital who already have a stake in the Chinese firm. Oracle is said to be preparing a bid for Canada, Australia and New Zealand operations of TikTok.
Oracle’s billionaire co-founder Ellison is one of the few US tech executives who has openly supported Trump, though it’s not clear whether Oracle would be the White House’s preferred suitor for TikTok.
Earlier this month, reports emerged that micro-blogging platform Twitter was also considering a bid for TikTok. However analysts sounded sceptical on the viability of any such deal given Twitter’s own financial position. Twitter’s market capitalization is about $29 billion while Microsoft’s is more than $1.6 trillion. The valuation of TikTok’s U.S. operations itself would run into the tens of billions of dollars.
Microsoft-Walmart joint bid comes within a day of resignation of TikTok’s chief executive Kevin Mayer. Meyer who joined TikTok from Walt Disney three months ago, cited the sharp change in political environment as the reason for leaving his job.