Walmart and Microsoft launch joint bid to buy TikTok

The viral video app could be banned in the US by Donald Trump if it not bought by an American company

Adam Smith
Thursday 27 August 2020 17:36
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Walmart is partnering with Microsoft in its purchase of TikTok.

The retail giant confirmed to CNBC that it is interested in buying the viral video app.

“We believe a potential relationship with TikTok US in partnership with Microsoft could add this key functionality and provide Walmart with an important way for us to reach and serve omnichannel customers as well as grow our third-party marketplace and advertising businesses,” it said.

“We are confident that a Walmart and Microsoft partnership would meet both the expectations of US TikTok users while satisfying the concerns of US government regulators.”

Walmart's stock price rose from two per cent to over four per cent as the news broke.

Microsoft declined to comment when contacted by The Independent. Instead, it highlighted its blog post, published on 2 August, 2020 where it announced its interest in buying TikTok.

The announcement does not mention Walmart.

The integration of TikTok into the company's e-commerce and advertising divisions “is a clear benefit to creators and users in those markets,” the company also said.

Walmart is developing Walmart+, a service similar to Amazon which will offer users same-day deliveries, discounts on products, and early access to deals.

The company did not specify how it would use TikTok or any potential integration into Walmart+.

Walmart uses Microsoft Azure, the technology giant's cloud services, as part of its business. In 2018, Walmart announced a five-year deal with Microsoft, which included Azure infrastructure and Office 356 services.

The acquisition news comes as TikTok CEO Kevin Mayer stepped down from his role in the company.

“In recent weeks, as the political environment has sharply changed, I have done significant reflection on what the corporate structural changes will require, and what it means for the global role I signed up for", he said in a statement.

"Against this backdrop, and as we expect to reach a resolution very soon, it is with a heavy heart that I wanted to let you all know that I have decided to leave the company."

As well as Walmart and Microsoft, Twitter is bidding for control of the company, as is Oracle and potentially Google's parent company, Alphabet.

President Donald Trump signed an executive order earlier this month to ban the app from the United States on claimed national security grounds.

The app has until the 21 September, 2020 before it would be removed from the country.

This is due to allegations that TiKTok's aprent company, Bytedance, would be forced to share information about US citizens with the Chinese government.

TikTok has consistently denied that would be the case. It also said Mr Trump's ban would be illegal and plans to sue the Trump administration.

The Independent has reached out to Walmart and TikTok for further comment.

As well as TikTok, the Trump administration is looking to ban WeChat, a Chinese messaging and payment app, for similar reasons, although Apple and Disney have warned against it.

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