2 months ago| article
India's biggest telco, which has raised US$20 billion in capital in recent months from firms including Facebook and Google, is reportedly eyeing an investment in embattled TikTok.
Aug 13, 2020 05:06:00 AM | Article | Jessica Goodfellow Share -
ByteDance, the parent company of popular video app TikTok, is reportedly in early-stage discussions to source investment from Reliance Industries in a move that could allow it to re-launch TikTok in India.
TikTok was one of 59 apps developed by Chinese firms to be banned by the Indian government in late June over security concerns. The move was a major blow to the short-video app, since India was TikTok's biggest market by a significant mark (the market contributed 44% of TikTok's total downloads in 2019, according to App Annie). It had 200 million users in India when it was banned in June.
Following the ban, TikTok representatives were invited to meet with concerned government stakeholders to respond to and clarify any concerns. It appears that from these meetings, ByteDance may have been given a similar ultimatum in India as it was in the US. That is, sell a portion or all of its international business to a locally owned company—a move that will boost the local economy and allay concerns about TikTok's relationship with the Chinese government—or face a permanent ban.
According to a TechCrunch report, ByteDance and Reliance Industries, the conglomerate owned by India’s richest man Mukesh Ambani, began conversations about a deal in late July. The report goes on to suggest that the two parties are yet to reach an agreement, but suggested that TikTok’s business in India is being valued at more than US$3 billion.
ByteDance did not provide a statement on the matter. Campaign Asia-Pacific reached out to Reliance, but it did not respond to a request for comment by the time of publication.
Reliance Industries is the parent firm of telecom giant Jio Platforms, the biggest telco in India with nearly 400 million users. The telco has raised about US$20 billion from 13 high-profile investors since April this year, including Facebook and Google, totalling a stake of around 33% of the company.
ByteDance employs about 2,000 people in India and has reportedly lost several high-level executives in recent weeks as its future in the market remains uncertain.
US software giant Microsoft is also in talks with the Chinese tech firm over an acquisition of TikTok's international business. The deal was initially thought to be limited to its US business, but is since believed to have been broadened to include Canada, Australia and New Zealand, India and Europe.
(This article first appeared on CampaignAsia.com)