G24, a UAE-based AI company, has invested around US$100mln in TikTok owner ByteDance at a price that gives teh Chinese group a US$220bln valuation.
The investing company, headed by UAE royal Sheikh Tahnoon bin Zayed Al Nahyan, used its 42XFund to buy a stake from other investors.
Last year G24, which is involved in projects ranging from vaccines to driverless cars, set up the US$10bln 42XFund to help invest in emerging technology markets- especially in Asia.
ByteDance’s newest valuation, however, is US$80bln less on a US$300bln price tag last year when the tech firm launched a share buyback for its private investors.
Valuations peaked in 2021 when US investment firm, Tiger Global Management, bought shares in the app developer at a price that valued it at US$460bln.
The slide in the TikTok owner's valuation likely reflects the recent banning of the app on government devices by multiple countries, something the UK is currently assessing.
In the last week, the US government proposed a new bill that could allow the President to prohibit the app’s use nationwide and even force the sale of the video-sharing service.
Fears have been rising for some time about the safety of TikTok, with countries worried about what ByteDance does with user data and whether the social media platform is being used to promote pro-Beijing views.
The Middle Eastern investment comes at a time when Chinese tech companies could be set to thrive, as three years of Covid restrictions and countless regulatory changes across the nation dented the economy.
The Abu Dhabi AI company’s investment might be a move to cash in on ByteDance’s successful use of artificial intelligence, said experts.
TikTok was developed to use algorithms that make the app easy to spend hours on while remaining personalised for each user.