Breakingviews - TikTok learns old lesson about U.S. art of deal

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(Reuters Breakingviews) - TikTok is finding out the hard way that the Oval Office may hold the trump cards in deals that raise national security concerns. President Donald Trump pushed for a sale of the popular video app, then threatened to ban it, prompting a call between him and suitor Microsoft’s Chief Executive Satya Nadella to salvage talks. The seller, parent company Beijing-based ByteDance, and other potential buyers have much to worry about.

Trump is playing dealmaker in what could be Microsoft’s biggest acquisition since it bought LinkedIn in 2016 for $26 billion. After both Reuters and the Wall Street Journal reported back-and-forth talks over the weekend, the $1.6 trillion company said on Sunday it would continue forging ahead after a call directly with the president.

Overseas ownership of companies or assets in the United States often draw the attention of the Committee on Foreign Investment. That panel made up of various government agencies has been investigating ByteDance’s 2017 purchase of lip-syncing app Musical.ly, which merged with TikTok. Most companies don’t bother to fight back, but in the rare occasions they do, a U.S. president may jump in.

That happened in 2012, the only legal challenge to CFIUS since it was established in 1975, when Chinese-based Sany Group’s affiliate Ralls Corp. bought wind farms in Oregon. Then- President Barack Obama ordered Ralls to not only divest the wind farms, but also forced it to remove items added to the facilities, including concrete foundation, and barred employee access to the premises. Sany complied.

That deal reaffirmed the commander-in-chief has carte blanche on M&A security risks. And Trump’s administration has meddled several times since. In March, Trump required Beijing Shiji Information Technology to sell hotel management software firm StayNTouch. In 2018, Ant Financial dropped its $1.2 billion purchase of MoneyGram. The Chinese owner of dating app Grindr was ordered to sell it three years after buying it in 2016.

The tougher environment has affected other deals. A banker told Breakingviews of two recent instances in which a Chinese firm received higher offers from Chinese suitors but went with a lower price from a U.S. buyer to avoid CFIUS reviews. ByteDance is the latest in a long line of Chinese firms that have learned Uncle Sam is the ultimate poison pill.Reuters Breakingviews is the world's leading source of agenda-setting financial insight.

 

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It’s time to hit back hard at the UsA.

That of Mafia and thugs

The most powerful country of the world is actually a Robber as well. Funny, isn't it? It makes me recall another French company, Alstom.

It let more people including Chinese and Americans to know what is the real market economic.

Descendants of pirates “make America great again ”!

I’m sorry, but you call robbing an art?

It happened and will happen to European Companies too

You mean the part where Trump says only he can fix our problems-which first he must create, and, at any cost, arrange for a solution he then can use to make himself the hero?.. After he has brought us all to the precipice of some destruction/horrific outcome? Then, yes, I agree!

Working for China. Thanks reuters

The art of the deal is BS.

They're actually stealing data with this app

Mafia🤢🤮

you mean 'art of steal'?

Art, hahaha, Alcatel knew it well.

What art? I wonder if a pure robbery can be called art?

Well, it is the 'art' of deal...

You mean robbery?

'Uncle Sam is the ultimate poison pill' implies Moon Jae-in far prefers the healthier dose of CCPChina or XinnieThePooh koolaid.

Yeah, OBOR could came from IMF style of old business.

I hope you all start paying attention kids, cause no matter how boring you think politics are, it can dramatically affect your life.

Pigeon Inc., take over TicTok as subsidary & give independent charge.

😊

The US is not an open market or friendly to investment after all.

what art🤣🤣🤣

That Trump is utterly incompetent and a bad deal maker?

Gross.

Fck Tiktok. 😘 Trump

Fart of the deal.

The art of robbery

What kind of title is this?

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