by Perplexity AI has presented a new proposal TiktokThe parent company that would allow the US government to own up to 50% of a new entity that merges Perplexity with Tiktok’s US business, according to a person familiar with the matter.
The proposal, submitted last week, is a revision of an earlier plan that the artificial intelligence startup presented to Tiktok’s parent -bytedance on January 18, a day before the Bans Tiktok law went into effect.
The first proposal, to which Bytedance has not responded, sought to create a new structure that would merge the San Francisco-based Perplexity with Tiktok’s US business and include investments from other investors.
The new proposal would allow the U.S. government to own up to half of that new structure once it makes an initial public offering of at least $300 billion, said the person, who was not authorized to speak on the proposal. The person said Pertlexity’s proposal was revised based on feedback from the Trump administration.
If the plan is successful, the government-owned shares would not have votes, the person said. The government would also have no place on the board of the new company.
Bytedance and Tiktok did not immediately respond to a request for comment.
Under the plan, Bytedance would not have to completely cut ties with Tiktok, a favorable outcome for its investors. But it should allow “full U.S. governance control,” the person said.
Under the proposal, the China-based tech company would contribute Tiktok’s U.S. business without the proprietary algorithm that bans what users see in the app, according to a document seen by the Associated Press.
The proposal appears to reflect a strategy that Steven Mnuchin, Treasury Secretary during President Donald Trump’s first term, discussed Sunday about Fox News futures — that a new investor in Tiktok could simply “dilute” the Chinese ownership and law can satisfy. Mnuchin has previously expressed interest in investing in the company.
“But the technology needs to be decoupled from China,” he added. “It needs to be decoupled from bytedance. There is absolutely no way China would ever let us have something like that in China.”
The ban proposal comes as several investors express concern interest in TikTok. Mr. Trump said on Saturday that he expects a deal to be struck within 30 days.
During a flight from Las Vegas to Miami on Air Force One, Mr. Trump also said he had not discussed a deal with Larry Ellison, CEO of software maker Oracle, despite a report that Oracle, along with outside investors, was considering acquiring Tiktok’s global operation.
“Tons of people are talking to me. Very substantial people,” Mr. Trump said. “We have a lot of interest in it and the United States will be a big beneficiary. … I would only do it if the United States benefits.”
Under a bipartisan law passed last year, Tiktok was to be banned in the United States on January 19 if it did not cut ties with bytedance. The Supreme Court upheld the law, but Mr. Trump then issued an executive order to halt enforcement of the law for 75 days.
Mr. Trump, on Air Force One, noted that Ellison lives “right down the road” from his Mar-a-Lago estate, but added: “I’ve never talked to Larry about Tiktok. I’ve talked to a lot of people about Tiktok spoken and There is great interest in Tiktok.”
Tiktok has been briefly shut down A week ago in the US, but went back online after Mr Trump said he would delay the ban. Mr Trump had unsuccessfully attempted a US ban of the platform during his first term. But he has since reversed his position and credited the platform with helping him win over more young voters in last year’s presidential election.
Tiktok CEO Shou Chew was present Mr. Trump’s inauguration January 20, along with several others Tech leaders who have forged friendlier ties with the new administration.
Congress voted to ban Tiktok in the US over concerns that Tiktok’s ownership structure posed a security risk. The Biden administration argued in court for months that allowing a Chinese company to control the algorithm that powers what people see in the app was too much of a risk. Officials also raised concerns about user data collected on the platform.
To date, however, the US has provided no public evidence that Tiktok is handing over user data to Chinese authorities or allowing them to tinker with its algorithm.
