TikTok IPO Reliant on President Trump’s Approval

As TikTok plans towards its IPO, sources tell CNBC’s David Faber outlets that the company’s fate is reliant o President Donald Trump’s decision in the next 24-36 hours.

TikTok’s parent company, ByteDance also plans to have the initial public offering on a U.S. stock exchange to address ownership issues, according to sources familiar with the matter. In addition, Oracle will own a minority stake of less than 20% in the new global TikTok. Walmart will also be given an unknown stake in the video app company.

On Wednesday night, the treasury department sent significant revisions concerning security issues on the TikTok/Oracle deal. TikTok’s parent company, ByteDance fully agrees to the revisions although the details remain unclear, people familiar with the matter said.

With respect to the TikTok/Oracle deal, President Trump has been in private talks with the Cabinet members and other advisers to decide whether or not to give his approval. According to the unnamed sources, there are slight controversies and different points of view among the Trump cabinet and advisers, including Secretary of Treasury Steve Mnuchin, Secretary of State Mike Pompeo, Jared Kushner, the president’s son-in-law.

If the TikTok IPO eventually works out it would be the largest technology initial public offering in recent years, having a valuation of about $50 billion. Other initial public offerings done recently such as Snowflake turned out successful adding billions of dollars to their worth.

Due to regulatory concerns between the United States and China, President Trump said on Wednesday that he wasn’t in support of the idea that Beijing-based ByteDance would hold a majority skate in TikTok.

“From the standpoint of ByteDance we don’t like that,” the president said. “I mean, just conceptually I can tell you I don’t like that.”

Chinese officials will also have a say in deciding TikTok’s fate which could possibly lead to more complications for the companies involved.

To assure the United States officials of transparency of the company, ByteDance plans to keep the company as a publicly-traded company under any US stock exchange, alongside having a U.S. board of directors for the company’s U.S. operations.

President Trump on Wednesday planned to demand “key money” concerning the transaction but was told by his lawyers that it was illegal.

“Amazingly I find that you’re not allowed to do that,” said Trump. “I said, ‘What kind of thing is this?’ If they’re willing to make big payments to the government, they’re not allowed because there’s no way of doing that from a – there’s no legal path to do that.”