TikTok: China’s ByteDance agrees to divest US operations after Trump threat

China’s ByteDance has agreed to divest the US operations of TikTok completely in a bid to save a deal with the White House, after Donald Trump said on Friday he had decided to ban the popular short-video app, two people familiar with the matter said on Saturday.

US officials have said TikTok under its Chinese parent poses a national risk because of the personal data it handles. ByteDance’s concession will test whether Trump’s threat to ban TikTok is a negotiating tactic or whether he is intent on cracking down on a social media app that has up to 80 million daily active users in the US.

ByteDance was previously seeking to keep a minority stake in the US business of TikTok, which the White House had rejected. Under the new proposed deal, ByteDance would exit completely and Microsoft would take over TikTok in the US, the sources said. Some ByteDance investors that are based in the US may be given the opportunity to take minority stakes in the business, the sources added

The Wall Street Journal reported on Saturday that Trump’s threat had stalled negotiations. “Before Mr Trump’s remarks, the two sides believed the broad strokes of a deal could be in place by Monday,” the paper reported on a possible TikTok-Microsoft sale, citing unnamed sources.

The White House did not respond to a request for comment on whether Trump would accept ByteDance’s concession. ByteDance in Beijing did not respond to a request for comment.

Microsoft did not respond to a request for comment.

Trump told reporters onboard Air Force One late on Friday that he would issue an order for TikTok to be banned in the United States as early as Saturday. “Not the deal that you have been hearing about, that they are going to buy and sell … We are not an M&A [mergers and acquisitions] country,” Trump said.

The White House declined to comment on whether Trump would accept ByteDance’s concession. ByteDance in Beijing did not respond to a request for comment.