Aravind Srinivas led Perplexity AI has revised merger proposal sent to TikTok owner ByteDance for creation of a new joint entitiy, reported Reuters. Under the new terms, the US government is said to be offered up to 50% of the new company during a future IPO at a valuation of at least $300 billion.
What is Perplexity offering TikTok?
Reportedly, Perplexity is proposing the creation of a new US holding company called “NewCo”. ByteDance would reportedly sell TikTok US to the investors, giving the company’s existing investors equity in the new structure.
Perplexity is also proposing that ByteDance keep its core recommendation algorithm. The AI search engine is also willing to be acquired by the new holding company if its investors received part of the NewCo equity.
Notably, TikTok had went offline in the US last week for around 14 hours in compliance with a US law which states that the social media app must cut ties with its Chinese parent or be shut off in the country. After Donald Trump took oath as new US President, he passed an executive order which gave the app an additional 75 days to comply with law.
As things stand, the legality of Trump’s executive order is not yet clear given that the ban on TikTok came into force on 19 January and the short video app remains unavailable to download from Google’s Play Store and Apple’s App Store.
Who else could buy TikTok?
A recent NPR report had recently stated that Donald Trump administration is working on a plan to save TikTok by tapping Oracle and a group of outside investors that includes Microsoft to take control of the short-video app. TikTok’s Chinese owner ByteDance is said to retain a minority stake in the company, but the reported deal could see the app’s algorithm, data collection and software updates controlled by Oracle.
A meeting between White House officials and Oracle executives is said to have taken place on Friday to discuss the potential deal, with another meeting scheduled for next week. Under the agreement, TikTok’s American investors could own a majority stake in the app. However, the report adds that the terms of the deal are still being worked out and are subject to change at this stage.
