ByteDance in Talks with RIL for Investment in TikTok

China’s ByteDance is in early talks with Reliance Industries Ltd for an investment in its video-based app TikTok in India. The two companies began conversations late last month and have not reached a deal yet. The Indian government in June banned 59 Chinese apps, including TikTok and WeChat, for threatening its sovereignty and integrity after border tensions with China. Last week, U.S. President Donald Trump unveiled bans on U.S. transactions with China-based owners of messaging app WeChat and TikTok, escalating tensions between the two countries. Besides, Microsoft has been in talks to acquire the U.S. operations of Tik Tok. Social media platform Twitter Inc has also expressed interest in having a deal with TikTok.

ByteDance Ltd. is a Chinese multinational internet technology company headquartered in Beijing. It was founded by Zhang Yiming in 2012. ByteDance is reportedly worth over $100 billion as of May 2020. ByteDance’s core product, Toutiao, is a content platform in China and around the world. Toutiao started out as a news recommendation engine and gradually evolved into a platform delivering content in various formats, such as texts, images, question-and-answer posts, microblogs, and videos.

ByteDance is the developer of the video-sharing social networking service Douyin (TikTok). On November 9, 2017, ByteDance acquired social media start-up Musical.ly for up to $1 billion. They combined it with TikTok on August 2, 2018 into a single global application, keeping the TikTok name.

The two companies began conversations late last month and have not reached a deal yet

As of November 2018, ByteDance had over 800 million daily active users (over one billion accumulated users) across all of its content platforms. The company was valued at $78 billion and is considered one of the most valuable unicorns in the world. It has an internal committee of the Chinese Communist Party as well as strategic partnerships with the Ministry of Public Security and Chinese Communist Party-supported ventures in Beijing and Shanghai.

ByteDance is backed by Kohlberg Kravis Roberts, SoftBank Group, Sequoia Capital, General Atlantic, and Hillhouse Capital Group. It has garnered public attention over allegations that it worked with the Chinese Communist Party to censor and survey content pertaining to Xinjiang re-education camps and other topics the Party deemed controversial.

Reliance Industries Limited (RIL) is an Indian multinational conglomerate company headquartered in Mumbai, Maharashtra, India. Reliance owns businesses across India engaged in energy, petrochemicals, textiles, natural resources, retail, and telecommunications.

Reliance is one of the most profitable companies in India, the largest publicly traded company in India by market capitalization, and the largest company in India as measured by revenue after recently surpassing the government-controlled Indian Oil Corporation. On 22 June 2020, Reliance Industries became the first Indian company to exceed $150 billion in market capitalization after its market capitalization hit Rs.11,43,667 crore on the BSE.