Twitter has approached TikTok’s Chinese owner ByteDance to express interest in acquiring the U.S. operations of the video-sharing app.
However, experts have raised doubts over Twitter’s buying power.
It is far from certain that Twitter would be able to outbid Microsoft Corp and complete such a transformative deal in the 45 days that U.S. President Donald Trump has given ByteDance to agree to a sale.
The news of Twitter and TikTok being in preliminary talks and Microsoft still being seen as the front-runner in bidding for the app’s U.S. operations was reported earlier by the Wall Street Journal.
Twitter has a market capitalization of close to $30 billion almost as much as the valuation of TikTok’s assets to be divested, and would need to raise additional capital to fund the deal.
Twitter’s shareholders, private equity firm Silver Lake, is interested in helping fund a potential deal.
Twitter has also privately made a case that its bid would face less regulatory scrutiny than Microsoft’s, and will not face any pressure from China given that it is not active in that country.
Earlier, US President Donald Trump signed two executive orders givving Americans 45 days to stop doing business with the Chinese platforms.
The president has cited “threat to national security, foreign policy, and economy of the United States”..