(Reuters) – U.S.-based search engine startup Perplexity AI has reportedly submitted a bid to TikTok’s Chinese parent company ByteDance for a potential merger with TikTok U.S., according to a source familiar with the matter.
There is a looming U.S. ban on TikTok set to commence on Sunday unless the social media platform severs ties with ByteDance. However, President-elect Donald Trump has indicated that he is considering granting TikTok a 90-day reprieve commencing on Monday.
Initial reports of Perplexity AI’s offer were first disclosed by CNBC. The proposed merger would see Perplexity combining forces with TikTok U.S. to establish a new entity in partnership with New Capital Partners, as per the source.
The proposed structure put forth by Perplexity would enable most of ByteDance’s current investors to retain their ownership stakes, while also enhancing Perplexity’s video capabilities. The source, who requested anonymity due to the sensitive nature of the discussions, highlighted that the bid is being viewed as a merger rather than an outright sale.
TikTok has not yet responded to requests for comment, and efforts to reach out to New Capital Partners for their input were unsuccessful at the time of reporting.
Perplexity AI is optimistic about the potential success of its bid, emphasizing the collaborative merger approach as a key differentiator. The company’s search tools are designed to provide users with prompt responses to inquiries, complete with relevant sources and citations. These tools leverage advanced language models sourced from organizations such as OpenAI and Meta Platforms’ open-source model Llama.
On the other hand, TikTok, a platform that has resonated with nearly half of the U.S. population, has played a significant role in supporting small businesses and shaping online trends. TikTok recently announced that it is poised to cease operations in the U.S. unless assurances are provided by President Joe Biden’s administration to companies like Apple and Google, assuring them that they will not face repercussions once the ban comes into effect.
This report was compiled by Mrinmay Dey in Bengaluru and has been reviewed for accuracy by Cynthia Osterman and Rod Nickel as part of our commitment to upholding journalistic integrity.
