The owner of TikTok has chosen Oracle over Microsoft as its preferred suitor to buy the popular video-sharing app, according to a source familiar with the deal. Under the proposed deal, Oracle will be ByteDance's technology partner and will assume management of TikTok's U. S. user data, the sources said. Oracle is also negotiating taking a stake in TikTok's U. S. operations, the sources added. Some of ByteDance's top backers, including investment firms General Atlantic and Sequoia, will also be given minority stakes in TikTok's U. S. operations under the proposed deal, one of the sources said.Microsoft announced Sunday that its bid to buy TikTok has been rejected, removing a leading suitor for the Chinese-owned app a week before President Donald Trump promises to follow through with a plan to ban it in the US.
Microsoft said in a Sunday statement that TikTok's parent company, Bytedance, let us know today they would not be selling TikTok's US operations to Microsoft.
The Trump administration has threatened to ban TikTok by mid-September and ordered ByteDance to sell its US business, claiming national-security risks due to its Chinese ownership. The government worries about user data being funneled to Chinese authorities. TikTok denies it is a national-security risk and is suing to stop the administration from the threatened ban.
Walmart had planned to partner with Microsoft on the deal.
It's not clear if Walmart is still interested. Oracle has declined to comment.
TikTok also declined comment Sunday.
Microsoft said Sunday it was confident our proposal would have been good for TikTok's users, while protecting national security interests. The company said it "would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combating disinformation. It is unclear whether Trump, who wants a U. S. technology company to own most of TikTok in the United States, will approve the proposed deal. The Committee on Foreign Investment in the United States (CFIUS), a U. S. government panel which reviews deals for potential national security risks, is overseeing the talks between ByteDance and Oracle. Oracle's chairman Larry Ellison is one of the technology world's few supporters of Trump. The firm has significant technological prowess in handling data, but no experience in social media. Its clientele comprises companies, rather than consumers.