It would be unprecedented, based on recent history, for the US government to collect a cut of a transaction involving companies in which it doesn't hold a stake
If successful, Microsoft will take over the app's operations in the US and potentially also in Canada, Australia and New Zealand
Microsoft made the announcement after its chief executive, Satya Nadella, talked with President Trump, who had threatened to ban the hugely popular social media company, which is owned by ByteDance
The president's interventions in company dealings based on his own instincts are a departure from the arm's-length approach of predecessors of either party
A formal announcement from ByteDance's founders on setting up shop in London is expected soon, said the report
President Donald Trump only agreed to allow Microsoft Corp to negotiate the acquisition of popular short-video app TikTok if it could secure a deal in 45 days
TikTok has had a fraught relationship with the United States government for some time
One idea under consideration is to give Microsoft and ByteDance a transition period to develop technology for TikTok that will be completely separate from ByteDance
The Chinese firm also said it faced 'complex and unimaginable difficulties' as it worked to grow into global company
Senator John Cornyn, a Texas Republican, said on Twitter that a divestment "and purchase by U.S. company is win-win."
Talks to buy the music video app will move quickly "in a matter of weeks" and are expected to be completed no later than Sept. 15, Microsoft said in a statement
ByteDance's concession will test whether Trump's threat to ban the app is a negotiating tactic
Donald Trump said he could use emergency economic powers or an executive order to enforce the action
Microsoft is in exploratory deal talks as the US government prepares to force China-based ByteDance to divest its video app TikTok over data security concerns, says report
Trump's comments came after published reports suggested his administration was planning to order China's ByteDance to sell TikTok
Of the two venues, the company prefers Hong Kong, it says
ByteDance was valued at as much as $140 billion earlier this year when one of its shareholders
TikTok needs a new global HQ for its business outside China after security experts flagged its data sharing practices
After India banned 59 Chinese apps last month, at least three more China-based video apps - Snack Video, Likee Lite, and Zili - have now made it to the list of top 10 downloaded apps in India
The lockdown has also added to the traction that video and audio apps such as Chingari, Roposo, Khabri and Trell are seeing as people are looking at options to earn incentives from home