Business

Twitter is reportedly the latest company to investigate a deal with TikTok

It’s very early, but it would be huge if this deal moved forward.

3 min read

Twitter is reportedly the latest company to investigate a deal with TikTok
Twitter is reportedly the latest company to investigate a deal with TikTok

This story originally appeared on Engadget

TikTok’s list of applicants goes well beyond Microsoft. Sources of Wall Street Journal say Twitter has “preliminary talks” about a possible merger with the US business of Tick ​​tock. It’s too early and the deal may not go ahead, but Twitter believes it has an advantage over bidders like Microsoft due to its size. According to insiders, he would not get as antitrust scrutiny if he closed a deal.

However, the size of Twitter could also be a disadvantage. TikTok’s US business alone could be worth tens of billions of dollars, and that would be a serious hurdle when Twitter’s total market cap is $ 29 billion. You will likely need to get the help of investors and take on a large debt. And while it has been relatively successful in recent years, it suffered a loss of more than $ 1.2 billion in the last quarter. The company may not be able to buy a giant like TikTok.

However, a deal would dramatically change the course of Twitter. It’s considered small at the moment compared to Facebook, but it would suddenly have a lot more impact: it has 186 million daily active users worldwide, but TikTok is said to have had 41 million previously (excluding its Chinese brother Douyin). the pandemic. Unlike Vine’s unfortunate deal, TikTok would likely need to be treated like a full-blown Twitter counterpart rather than a plugin.

Whether or not Twitter takes a step, the report underscores the pressure on TikTok. President Trump has given the company until September 15 to sell its US operations if it wants to avoid a ban in the country. TikTok doesn’t have much time to close a deal, and that means being open to offers that you wouldn’t have entertained in the past.

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