Trump Expresses Support for Oracle to Buy TikTok

(WSJ) President Trump voiced support on Tuesday for Oracle Corp. to buy the U.S. operations of TikTok, adding a fresh wrinkle to the bidding for the Chinese-owned video-sharing app.

Oracle is a new entrant in the negotiations for TikTok, whose owner ByteDance Ltd. is facing a fall deadline from the Trump administration to divest itself of its U.S. operations.

Oracle, a giant in business software, has had preliminary discussions about teaming with some of ByteDance’s existing minority investors to buy TikTok’s U.S. operations but it isn’t clear how advanced the talks are, said people familiar with the matter.

Microsoft Corp. said earlier this month it was in negotiations with ByteDance, and that it was coordinating with the White House. Twitter Inc. is also exploring a bid, The Wall Street Journal previously reported.

The Financial Times earlier reported Oracle’s involvement.

Oracle has closer ties to the White House than most other parties involved in the bidding. Larry Ellison, the company’s co-founder, chairman and largest shareholder, earlier this year threw a fundraiser at his house for the president. Chief Executive Safra Catz also worked on the executive committee for the Trump transition team in 2016.

Asked Tuesday if Oracle would be a good buyer for TikTok, President Trump said, “Well I think Oracle is a great company and I think its owner is a tremendous guy, a tremendous person. I think that Oracle would be certainly somebody that could handle it.”

The Trump administration has said TikTok represents a threat to national security because it is owned by a Chinese company. ByteDance has repeatedly disputed U.S. claims that it would share information on U.S. users with the Chinese government.

Oracle, in many respects, would be a more unexpected buyer than Microsoft for the youthful video-sharing app. Like Microsoft, the database company is principally focused on corporate customers and has invested heavily in boosting its cloud-computing business. But Microsoft has some consumer-facing products such as its Xbox videogame business and Bing search engine that Oracle lacks. Microsoft has said it was looking to agree to a deal by mid-September.

Oracle also doesn’t have Microsoft’s deep pockets. The Redmond, Wash.-based company has more than $136 billion in cash. Redwood City, Calif.-based Oracle ended the last fiscal year with around $37 billion in cash and equivalents.

TikTok has been looking for a potential acquirer who could bring the engineering expertise needed to keep the service up and running after splitting from ByteDance, said someone familiar with the deal. Oracle has been expanding its cloud-computing business and could shift TikTok’s U.S. service onto its own servers.

Oracle is working with Sequoia Capital and General Atlantic, investors that already have stakes in ByteDance, some of the people said.

Mr. Trump on Tuesday also reiterated his condition that any TikTok buyer must make a substantial payment to the U.S. government as part of the transaction.

“I guess Microsoft wants it and so does Oracle. And probably so do other people. But they have to make sure the United States is well compensated. Because we’re the ones making it possible. So our Treasury has to be very well compensated.”

“You have to put money into the Treasury,” he said.

Mr. Trump’s comments follow a series of executive orders from the president that set a 45-day deadline for an American company to purchase TikTok’s U.S. operations, as well as a 90-day deadline for the transaction to be completed.

Source: Wall Street Journal by Aaron Tilley and Georgia Wells

Trump Expresses Support for Oracle to Buy TikTok Trump Expresses Support for Oracle to Buy TikTok Reviewed by TechCO on 8/19/2020 Rating: 5

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