Even as Microsoft is reportedly in talks to buy TikTok, the United States is preparing to force Chinese company ByteDance to sell its U.S. assets for the short video app over concerns that Chinese ownership could jeopardize personal data, people familiar with the matter said on Friday.
The move would represent a major blow for the Beijing-based company, which became one of only a handful of truly global Chinese conglomerates thanks to TikTok’s commercial success.
It was not immediately clear how the separation would happen and what ByteDance would do with the rest of TikTok’s global operations. An announcement could come as early as Friday, the sources said, requesting anonymity because the matter is confidential.
News outlets including Fox Business and The New York Times reported Friday that Microsoft is in talks to buy the U.S. version of TikTok.
ByteDance and the U.S. Treasury Department, which chairs the government panel that has been reviewing ByteDance’s ownership of TikTok, declined to comment.
Treasury Secretary Steve Mnuchin said on Wednesday that TikTok was under a national security review by the Committee on Foreign Investment in the United States (CFIUS) and that he would be making a recommendation to President Donald Trump this week.
“We are looking at TikTok, we may be banning TikTok, we maybe doing some other things or a couple of options, but a lot of things are happening,” Trump told reporters on Friday.
As relations between the United States and China deteriorate over trade, Hong Kong’s autonomy, cyber security and the spread of the novel coronavirus, TikTok has emerged as a flashpoint in the dispute between the world’s two largest economies.
Last week, the U.S. Senate Committee on Homeland Security and Governmental Affairs unanimously passed a bill that would bar U.S. federal employees from using TikTok on government-issued devices. It will be taken up by the full Senate for a vote. The House of Representatives has already voted for a similar measure.
ByteDance has proactively been considering a range of options for TikTok amid pressure from the U.S. to relinquish control of the app, which allows users to create short videos with special effects and has become wildly popular with teenagers in the U.S.
ByteDance has received a proposal from some of its investors, including Sequoia and General Atlantic, to transfer majority ownership of TikTok to them, Reuters reported on Wednesday. The proposal values TikTok at about $50 billion US.
ByteDance has also fielded acquisition interest in TikTok from other companies and investment firms, Reuters has reported.
ByteDance acquired Shanghai-based video app Musical.ly in a $1 billion US deal in 2017 and relaunched it as TikTok the following year.
ByteDance did not seek approval for the acquisition from CFIUS, which reviews deals for potential national security risks. Reuters reported last year that CFIUS had opened an investigation into TikTok.
The United States has been increasingly scrutinizing app developers over the personal data they handle, especially if some of it involves U.S. military or intelligence personnel.
Ordering the divestment of TikTok would not be the first time the White House has taken action over such concerns.
Earlier this year, Chinese gaming company Beijing Kunlun Tech Co Ltd sold Grindr LLC, a popular gay dating app it bought in 2016, for $620 million US after being ordered to divest by CFIUS.
In 2018, CFIUS forced China’s Ant Financial to scrap plans to buy MoneyGram International Inc. over concerns about the safety of data that could identify U.S. citizens.
ByteDance was valued at as much as $140 billion US earlier this year when one of its shareholders, Cheetah Mobile, sold a small stake in a private deal, Reuters has reported. The startup’s investors include SoftBank Group Corp.
The bulk of its revenue comes from advertising on apps under its Chinese operations including Douyin — a Chinese version of TikTok — and news aggregator app Jinri Toutiao, as well as video-streaming app Xigua and Pipixia, an app for jokes and humorous videos.
Some of the company’s other overseas apps include work collaboration tool Lark and music streaming app Resso.
TikTok CEO Kevin Mayer, a former Walt Disney Co. executive, said in a blog post on Wednesday that the company was committed to following U.S. laws, and was allowing experts to observe its moderation policies and examine the code that drives its algorithms.
'Like gold': Canadian canola prices spike as shippers find back door to China – Reuters
WINNIPEG, Manitoba/BEIJING (Reuters) – Canadian canola prices have soared to the highest in nearly two years, despite a diplomatic dispute between Ottawa and Beijing, as exporters find roundabout ways to reach top oilseed buyer China.
A deer feeds in a western Canadian canola field which are in full bloom this week before it will be harvested later this summer in rural Alberta, Canada July 23, 2019. REUTERS/Todd Korol
Chinese authorities have since March 2019 blocked canola shipments by two Canadian exporters, an action they took after Canadian police detained a Huawei Technologies executive in late 2018 on a United States warrant.
The dispute however, has not spoiled China’s appetite for canola, which is mainly processed into vegetable oil. While China is buying less from Canada directly, it has bought canola oil instead from Europe and the United Arab Emirates, with some of that oil made from Canadian canola, traders said.
ICE canola futures RSc1 on Tuesday hit the highest nearby price since October 2018. Prices of China’s rapeseed oil, another name for canola oil, have also rallied, partly because of limited Canadian supply.
“Profits are extravagant. Anyone who has the resources to import (canola oil) will definitely buy,” said a manager with a China-based canola importer.
“It is like gold oil now.”
Canadian canola exports to China fell 45% year over year during the 11-month period through June, however total canola exports have jumped 9%, helped by a tripling of sales to France and double the shipments to the UAE.
Canada is the world’s biggest canola producer, and the yellow-flowering plant earned farmers C$8.6 billion ($6.42 billion) last year, the most of any crop.
China meanwhile boosted canola oil imports from Europe, Russia and Australia, with some of that oil made from Canadian canola, said another China-based trader.
The price rally left farmer Mary-Jane Duncan-Eger, who grows canola near Regina, Saskatchewan, “super-mystified,” considering that Canada is heading for a bumper crop.
To lock in high prices, she pre-sold 50% of her anticipated harvest, up from the 30% she usually pre-sells at this time of year.
“I’m pretty happy. As long as someone is buying it, I don’t care who.”
Global canola oil demand has prompted Canadian crushers – who include Archer Daniels Midland Co (ADM.N) and Bunge Ltd (BG.N) – to process canola at a brisk pace, said Brian Comeault, commodity risk manager with Cargill Ltd’s [CARGIL.UL] Canadian marketing service MarketSense.
GRAPHIC: China edible oils prices – here
Exporters are also selling more seed to the UAE, where crushers produce oil to sell to China, he said.
Bad crop weather and insect attacks in Europe have also lifted prices.
Rapeseed production in the European Union and Britain is expected near the 13-year low seen in 2019.
This has led European importers to scour other countries for supplies, especially those with weaker currencies that make purchases more profitable, consultancy Strategie Grains said in a report.
“Canadian canola has the biggest edge,” it said. “Competition among importing countries will probably be fierce over the coming months.”
GRAPHIC: Canadian canola exports – here
GRAPHIC: China rapeseed oil futures prices – here
Reporting by Rod Nickel in Winnipeg, Manitoba, Hallie Gu in Beijing, Gus Trompiz in Paris and Michael Hogan in Hamburg; Editing by Marguerita Choy
Saudi Aramco profits crash 73% as coronavirus sinks oil market – RT
The world’s biggest oil exporter, Saudi Aramco, has reported massive losses for the second quarter, with its net profit nosediving 73.4 percent, as the Covid-19 outbreak crippled global demand for crude.
The oil giant’s net profit plunged to 24.6 billion riyals ($6.6 billion) for the three months to June 30, from 92.6 billion riyals ($24.7 billion) in the same period of 2019, according to a regulatory filing published at the Tadawul exchange where its stock trades. For the whole first half of the year, Saudi Aramco said its net income plunged to 87.1 billion riyals ($23.2 billion) down 50 percent from 175.9 billion riyals ($46.9 billion) one a year ago.
“Strong headwinds from reduced demand and lower oil prices are reflected in our second quarter results,” CEO Amin Nasser said, adding that the company is trying to adapt to the unprecedented conditions created by the pandemic. “We are seeing a partial recovery in the energy market as countries around the world take steps to ease restrictions and reboot their economies.”
The financial results, which were even worse than analysts predicted, however, did not sink the company’s stock. After the company presented the report on Sunday, its shares were up slightly by 0.15 percent. Notably, the company’s shares fell much less this year than those of its overseas peers. While Saudi Aramco stock slipped around six percent, those of Exxon Mobil were down 38 percent, while Shell declined by half.
Most energy companies have taken a painful blow from the coronavirus pandemic as lockdowns to contain the spread of the deadly virus limited travel and halted production, crushing demand for crude and sending oil prices into a tailspin. In April, US crude futures entered into negative territory for the first time in history.
While crude prices have already bounced from April lows thanks to output cuts agreed on by OPEC+ producers, they are still down around 30 percent from a year earlier.
Saudi Aramco went public last year, with its IPO becoming the largest in history. The oil giant has long held the position of world’s most valuable company – until last week, when it was dethroned by US tech giant Apple.
For more stories on economy & finance visit RT’s business section
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