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ByteDance, the parent company of TikTok, has assigned itself a valuation of approximately $300 billion in a recent share buyback offer, according to a report by The Wall Street Journal. This valuation, one of the highest in the company's history, comes despite the looming threat of a TikTok ban in the United States.
The $300 billion figure, revealed in a buyback offer to shareholders, suggests ByteDance remains confident in its future growth trajectory, even amidst ongoing regulatory uncertainty. This valuation represents a significant increase from the nearly $225 billion valuation assigned in a tender offer to employees in October 2023 and the $268 billion valuation from a December 2023 buyback, according to a company email seen by the WSJ.
The recent US presidential election and the subsequent victory of Donald Trump may have influenced this valuation. While Trump previously advocated for a TikTok ban, he has since indicated a willingness to "SAVE TIK TOK IN AMERICA," a shift in stance that has been viewed positively by ByteDance investors. This change follows a meeting between Trump and Jeff Yass, a prominent Republican donor and significant ByteDance investor. However, the extent to which Trump's new stance can impact the existing legislation remains unclear.
The existing law, signed by President Biden, mandates a TikTok ban in the US unless ByteDance divests the app by mid-January. ByteDance has already filed a lawsuit challenging this legislation, arguing that it violates the free-speech rights of its users. Despite the legal challenges, TikTok CEO Shou Zi Chew has maintained that the app will remain operational in the US.
ByteDance’s recent buyback offer, at approximately $180 per share, is a common strategy for providing liquidity to investors and early employees, especially in the current environment where initial public offerings (IPOs) remain challenging. Besides TikTok, ByteDance operates various other popular internet services in China and globally.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
