A flurry of bids is expected for TikTok as billionaire Elon Musk and tech firm Oracle emerge as key players in efforts to keep the social media platform available in the United States, following President Donald Trump's decision to grant more time for negotiations over the app's future.
TikTok ceased operations in the US for about 14 hours on Sunday after the Supreme Court upheld a law mandating that its Chinese parent company, ByteDance, divest from the platform or face a ban due to national security concerns.
Access to the app was restored after Trump said he intended to sign an executive order on Monday granting a 90-day postponement of the ban to give ByteDane more time to find a buyer.
“This game of high stakes poker now is laser-focused on Trump's next move,” Wedbush wrote in a note to clients.
“In this game of poker, TikTok went from its back against the wall to a massive position of strength with Trump behind the platform and heavily against the ban.”
Wedbush’s analysts believe behind the scenes, there has been significant activity from both financial and strategic tech buyers for TikTok.
“We continue to believe Musk will be heavily involved in finding a solution for TikTok and ultimately could build a consortium to buy TikTok,” they wrote.
“Other strategic/financial players are looking at this golden asset, but it needs to be formally approved by Beijing and will never be sold with the algorithm in our view.”
Oracle Corp (NYSE:ORCL, ETR:ORC) could play a key role in any deal due to the firms’ technology partnership with TikTok, analysts added.
Analysts also see TikTok as “a chip on the poker table” in more important US-China tariff negotiations set to take place over the coming month. If Trump does not act on the ban, the new administration will kick off these negotiations on the wrong foot right away, they believe.
“We believe ByteDance and ultimately Beijing is looking at the possibility that Musk/X could buy the US TikTok operations,” they wrote.
“Given the strong and growing alliance between Trump and Musk this is not a total shock route as behind the scenes the Trump White House is looking at alternatives right out of the gates starting next week to have some time to find a solution/deal.”
In this scenario, analysts see TikTok’s US operations being sold without its algorithm, the app’s “key DNA,” for between $40 million to $50 million.
“We now expect a slew of TikTok bids to come over the coming weeks from a host of larger tech players/private equity/other strategic names for this key social media platform,” they concluded.