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Microsoft Corp (NASDAQ:MSFT) To Bail Out Chinese-Owned TikTok By Acquiring Its US Operations

Video sharing app, TikTok, has been at the center of criticism regarding censorship and national security concerns in the US with the Trump administration threatening to ban it. But it seems Microsoft Corp (NASDAQ:MSFT) will bail out the Chinese-owned video app by acquiring its operations in the US, according to sources familiar with the issue.

Trump Administration wants TikTok US sold

There have been some rumors that the Trump administration had asked TikTok to divest its US operations. It comes as the popular app has been under probe regarding national security concerns owing to its Chinese roots. On Friday, while aboard Air Force One, Trump stated that he would ban TikTok in the US as early as Saturday. The president said that he would use an executive order or emergence economic powers to implement the action adding that he had the authority to do so.

Another person familiar with the matter said the decision was still on hold and under review. Early on Friday, Trump had been told that they were considering options for the video app.

A possible deal could face regulator challenges.

The deal with Microsoft will be a massive victory for the US Company as it forays into social media, and it will offer TikTok’s parent company some relief. There have been reports that several US firms are interested in acquiring TikTok as pressure from the Trump administration mounts for sale of TikTok in the US.

However, any form of the deal could face some regulatory hurdles due to the concerns that the app can be used to collect data on US users. ByteDance acquired in 2017, merging it with TikTok. They created a social media giant who was the first Chinese-owned app top make considerable inroads in the US. In 2019 the Committee on Foreign Investment commenced a probe regarding the acquisition of Over the years, the CFIUS has been aggressive in probing the purchase of US businesses in deals that could threaten US national security.

TikTok said that they were not commenting on speculation and rumors, as the focus is on the app’s long-term success.

Ruchi Gupta

Ruchi Gupta covers various beats from finance to technology and from lifestyle to hobbies. She has an MBA in Finance. Ruchi enjoys writing on celebrities and political news. She likes traveling and exploring places.

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