prc30 on Nostr: The War for TikTok in America - #5 This, slow rolling the sale, was expected and yet ...
The War for TikTok in America - #5
This, slow rolling the sale, was expected and yet should be viewed as just one front in the war over this dominate social media platform.
Leverage. It is that simple. With numerous parties vying over buying the American TikTok platform, the Chinese know the value of this platform and the role it can play in gaining a real advantage in the much larger trade conflict with America.
A point that I’ve not seen mentioned in all the media coverage is that TikTok parent ByteDance is 60% owned by foreign investors. Susquehanna Capital alone owns 15% of ByteDance. There’s real money at stake and incentives, you would think, are more than a little aligned. In the end, however, any deal will need to be approved by the Beijing ministerial powers.
Then there is the issue of the ByteDance “Golden Shares”
A 60% ownership stake might be irrelevant at least when it comes to “control”. The Chinese government began a process three years ago whereby “critical enterprises” were required to issue Golden Shares. Essentially these are a separate form of equity, akin to Preferred Shares. The aim of these Golden Shares, typically 1% of all outstanding equity, is to provide control over key board level decisions. Basically, Golden Shares allow the Chinese government to veto any vote deemed to go against the interests of China.
So, there remains a ton of moving parts, and I’ll just reiterate that China has all of the leverage.
https://www.reuters.com/technology/tiktoks-chinese-owner-appears-be-slow-rolling-negotiations-sale-washington-post-2025-02-05/
This, slow rolling the sale, was expected and yet should be viewed as just one front in the war over this dominate social media platform.
Leverage. It is that simple. With numerous parties vying over buying the American TikTok platform, the Chinese know the value of this platform and the role it can play in gaining a real advantage in the much larger trade conflict with America.
A point that I’ve not seen mentioned in all the media coverage is that TikTok parent ByteDance is 60% owned by foreign investors. Susquehanna Capital alone owns 15% of ByteDance. There’s real money at stake and incentives, you would think, are more than a little aligned. In the end, however, any deal will need to be approved by the Beijing ministerial powers.
Then there is the issue of the ByteDance “Golden Shares”
A 60% ownership stake might be irrelevant at least when it comes to “control”. The Chinese government began a process three years ago whereby “critical enterprises” were required to issue Golden Shares. Essentially these are a separate form of equity, akin to Preferred Shares. The aim of these Golden Shares, typically 1% of all outstanding equity, is to provide control over key board level decisions. Basically, Golden Shares allow the Chinese government to veto any vote deemed to go against the interests of China.
So, there remains a ton of moving parts, and I’ll just reiterate that China has all of the leverage.
https://www.reuters.com/technology/tiktoks-chinese-owner-appears-be-slow-rolling-negotiations-sale-washington-post-2025-02-05/