crossorigin="anonymous"> After its IPO faltered, ByteDance will buy back $3 billion worth of shares. - MalayTV.net

After its IPO faltered, ByteDance will buy back $3 billion worth of shares.

After delaying its eagerly anticipated initial public offering (IPO), ByteDance, the Chinese digital juggernaut behind TikTok, decided to buy back $3 billion worth of shares. The decision was made as ByteDance is under increasing pressure from the US government due to worries over TikTok’s impact on national security.

After its IPO faltered, ByteDance will buy back $3 billion worth of shares.

The Wall Street Journal reported that ByteDance, the company that owns TikTok, is preparing to repurchase up to $3 billion in stock from investors after delaying its scheduled initial public offering (IPO).

The action is being taken as US officials are looking more closely at ByteDance’s connections to China. After the Trump administration opened an inquiry into the business, ByteDance allegedly decided to postpone its intentions to float TikTok on a US stock market this year.

Although it’s not yet known how ByteDance would use the funds obtained from the share repurchase, the action may assist the business win over US authorities and increase its prospects for a successful IPO in the future.

What is ByteDance?

Chinese technology business ByteDance runs numerous well-known social media sites, including TikTok, and has a focus on artificial intelligence.

Zhang Yiming established ByteDance in 2012, and it now employs over 30,000 people. The firm was the most valuable startup in the world in 2018 as its valuation surpassed US$75 billion.

ByteDance declared intentions to list on the stock market for the year 2019. These plans, however, were shelved when the US government voiced reservations over the potential impact of ByteDance’s ownership of TikTok on national security.

Since then, ByteDance and US investors Oracle and Walmart have reached an agreement to sell a 20% share in TikTok. Additionally, the business intends to float its stock on the Hong Kong stock exchange.

Why did the IPO stall?

The Trump administration’s prohibition on the app caused the IPO for ByteDance, the company that owns TikTok, to be postponed. ByteDance lost out on a significant opportunity to list its shares on the stock market as a result.

Concerns that TikTok may be used to gather information on American users led to the ban. Since young people use the app a lot, there was concern that it may be used to gather data on them.

After the IPO fizzled, ByteDance said that it will buy back shares from investors for $1 billion. This is an effort to partially make up for the losses that investors suffered.

Overall, the Trump administration’s prohibition on TikTok caused the IPO for ByteDance to stagnate.

What will happen with the buy back of shares?

After its ambitions for a public offering fell through, ByteDance, the company that owns TikTok, has agreed to buy back $1 billion in shares from investors.

ByteDance will be able to generate money through the repurchase to support its growth objectives. Additionally, it will raise the company’s value.

 

In order to obtain money for its expansion, ByteDance had planned to float its shares on the stock exchange. However, the US government’s worries over TikTok’s data protection policies forced the business to postpone its IPO preparations.

 

The $1 billion repurchase shows ByteDance is still optimistic about its chances for the future. The business is optimistic that it will soon be able to list its shares on the stock exchange.

Conclusion

After experiencing a setback with its IPO, ByteDance intends to buy back $3 billion worth of shares. By making the modification, the business will increase its worth and avert any potential delisting from US markets. ByteDance has recently been among the most prosperous IT businesses, and this move will guarantee that it stays a significant role in the market.

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