Ex-Trump Treasury chief Steven Mnuchin pooling investors to buy TikTok: ‘It’s a great business’
- The move comes after the US House of Representatives passed a bill that gives Chinese owner ByteDance 6 months to divest the app or face a ban
- Beijing has sharply criticised the proposed legislation, giving no indication that it would allow a sale of TikTok
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Steven Mnuchin, the former US treasury secretary under Donald Trump, said on Thursday he was preparing a buyout bid of TikTok, as Beijing blasted a bill moving through Congress that would force the sale of the Chinese-owned video-sharing app.
TikTok has soared in popularity worldwide, but its ownership by Chinese technology giant ByteDance – and alleged subservience to Beijing’s ruling Communist Party – has fuelled national security concerns in Western capitals.
On Wednesday, the US House of Representatives overwhelmingly approved a bill that would force TikTok to divest from its parent company or face a nationwide ban.
The bill is yet to pass the Senate, where it is expected to face a tougher test to become law.
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The White House has said President Joe Biden would sign the bill – known officially as the Protecting Americans from Foreign Adversary Controlled Applications Act – if it reaches his desk.
Mnuchin on Thursday said he is putting together a team of investors to buy TikTok from its Chinese owners, once the bill passes.
“I think the legislation should pass and I think [TikTok] should be sold,” Mnuchin, an investment banker who led the Treasury Department throughout Trump’s term in office, told CNBC.
Mnuchin said TikTok was “a great business and I’m going to put together a group to buy” the embattled app.
“This should be owned by US businesses. There’s no way that the Chinese would ever let a US company own something like this in China,” he said.
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China has blocked Western online platforms such as Facebook and X (formerly Twitter) for years on its heavily-censored internet.
TikTok did not immediately respond to requests for comment.
Mnuchin gave no further details on his plan, nor the investors he was trying to assemble.
ByteDance, which is privately run, has major US shareholders including investment giants Kohlberg Kravis Roberts and General Atlantic as well as Silicon Valley stalwart Sequoia Capital.
Hedge funder Jeff Yass is also a major investor in ByteDance and is reported by US media as being among those lobbying against the bill.
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In a turnaround from his earlier stance, Trump this week said he is against the bill, but denied accusations that he changed his tune because Yass is donating to his campaign.
Any divestment of TikTok, either as a whole or just its US operations, would be a huge challenge, notably in the courts, and a transaction that only the world’s richest companies could afford.
Any attempt by a US tech giant to buy TikTok, with its 170 million US users, would almost certainly face intense antitrust scrutiny.
Beijing sharply criticised the bill giving no indication that it would allow a sale of TikTok from ByteDance.
TikTok gets thumbs up in China for ‘tough stance’ against US lawmakers
“The US should truly respect the principles of a market economy and fair competition [and] stop unjustly suppressing foreign companies,” Beijing’s commerce ministry spokesman He Yadong said at a press conference.
“China will take all necessary measures to resolutely safeguard its legitimate rights and interests,” he said, adding a call for Washington to “provide an open, fair, just, and non-discriminatory environment for foreign companies to invest and operate in the US.”
At a separate press briefing, foreign ministry spokesman Wang Wenbin said the vote “runs contrary to the principles of fair competition and international economic and trade rules”.
“If so-called reasons of national security can be used to arbitrarily suppress excellent companies from other countries, then there is no fairness and justice at all,” Wang said. “When someone sees a good thing another person has and tries to take it for themselves, this is entirely the logic of a bandit.”
TikTok has consistently denied that it is under the control of China’s Communist Party. Its CEO Shou Zi Chew has urged users to speak out against the vote, and several TikTok creators interviewed by Agence France-Presse voiced opposition to the proposed ban.
