Former US Treasury Secretary Mnuchin Wants to Acquire TikTok Amid Threat of US Ban

On the heels of the TikTok ban by the US House of Representatives, Steven Mnuchin, the former Treasury Secretary, said that along with an investor group, he’s planning to make a bid to buy the short-form video-sharing platform.

In an interview on CNBC’s Squawk Box, Mnuchin said that he hoped the bill would pass in the Senate, which could compel TikTok’s parent company, ByteDance, to divest its share to a US-based organization.

However, he was quick to say that the Chinese government would never approve of any kind of sale or divestiture to a US-based business. “There’s no way that the Chinese would ever let a US company own something like this in China,” Mnuchin said.

One of the reasons could be the large amount of data collected by the app. Used by nearly 170 million Americans, Mnuchin said that in his tenure as the Treasury Secretary, he had seen mounting evidence of the app’s capability to collect vast troves of user data.

The other factor widely suspected to be the main reason behind China’s reluctance to the sale, is TikTok’s powerful algorithm. Developed in China, this algorithm is the mainstay behind the platform’s success as it divines tailored content to users.

Without this algorithm, one wonders how attractive the sale of this platform to potential buyers would be. Earlier in 2020, the sale of TikTok to Walmart and Oracle hit a snag when Chinese regulators first added algorithms (technologies) to its export control list.

Nevertheless, there is a growing interest among US investors in acquiring the social media platform. Former Activision Blizzard CEO Bobby Kotick has also shown interest in bidding for the platform, according to a report in the Wall Street Journal.

TikTok, meanwhile, in an internal memo to employees, stated that it would continue with its current data protection strategy in the US and would use legal means to protect the platform.