Blackstone Withdraws from TikTok US Consortium Bid

Blackstone has dropped out of a consortium bid for TikTok's US operations. The group, led by Susquehanna International Group and General Atlantic, is still seeking to invest in TikTok's US business, but Blackstone's withdrawal adds uncertainty to the deal. The deadline for ByteDance to divest TikTok in the US has been repeatedly postponed, and the US consortium is exploring various options to address national security concerns.

Private equity giant Blackstone has withdrawn from a consortium seeking to invest in TikTok's U.S. operations, according to a source familiar with the matter [1]. The latest change comes amidst mounting uncertainty and several delays in the TikTok deal, which is at the center of U.S.-China trade talks.

The consortium, led by Susquehanna International Group and General Atlantic, had emerged as the front-runner to secure TikTok's U.S. business. The group had planned for U.S. investors to own 80% of TikTok, while ByteDance, the Chinese owner, would retain a minority stake. Blackstone had planned to take a minority stake in the TikTok U.S. business in this deal.

The withdrawal of Blackstone adds uncertainty to the deal, which has already faced numerous setbacks. The deadline for ByteDance to divest TikTok in the U.S. has been repeatedly postponed. Last month, President Trump signed a third executive order extending the deadline to September 17 [1]. In April 2024, Congress passed a law mandating a sale or shutdown of TikTok by January 19, 2025 [1].

ByteDance is exploring various options to address national security concerns, including selling or restructuring its U.S. operations. The Chinese social media giant, which raked in $43 billion in the first three months of this year, recently surpassed Meta in quarterly revenue [1].

The U.S. consortium, favored by the administration, also includes KKR and new investors such as Andreessen Horowitz. Oracle is also likely to take a stake. The consortium is still exploring options to address national security concerns related to Chinese control over TikTok.

If a sale is finalized, the new U.S. app is expected to be owned by a joint venture formed by an American investor consortium and ByteDance, which would maintain a minority stake. TikTok is already working on a U.S.-specific app [1].

References:
[1] https://ca.finance.yahoo.com/news/exclusive-blackstone-drops-consortium-bid-224655537.html
[2] https://sg.finance.yahoo.com/news/exclusive-blackstone-drops-consortium-bid-224655664.html