Walmart has partnered with Microsoft to bid for the US operations of TikTok, the popular Chinese-owned video sharing app that President Donald Trump has vowed to shut down unless it is sold to a US company by mid-November.
The world’s largest retailer said in a statement that it was confident its joint bid with the tech giant would satisfy the Trump administration, which has accused the app owned by Chinese company ByteDance of threatening national security.
Walmart’s interest in the social media platform, which would take it far from its business of selling a wide range of consumer goods and groceries, is a sign of the company’s aspirations to expand online as it takes on Amazon.
A purchase of TikTok could allow Walmart to better target a more youthful demographic as well as give it valuable data on online consumer behaviour.
“We believe a potential relationship with TikTok US in partnership with Microsoft could add this key functionality and provide Walmart with an important way for us to reach and serve omnichannel customers as well as grow our third-party marketplace and advertising businesses,” Walmart said in statement.
“We are confident that a Walmart and Microsoft partnership would meet both the expectations of US TikTok users while satisfying the concerns of US government regulators,” the US retailer added.
ByteDance’s founder and chief executive, Yiming Zhang, said on Thursday that the Chinese company was “moving quickly to find resolutions to the issues that we face globally, particularly in the US and India”.
Walmart’s entry into the race to buy TikTok in concert with Microsoft was first reported by CNBC.
The unusual duo is currently in a race for the US operations against software giant Oracle, which is bidding together with a group of US investors including General Atlantic and Sequoia.
The Financial Times revealed on Thursday that TikTok chief executive Kevin Mayer was quitting his role just months after joining due to the political environment that had hit the company’s operations.
Walmart shares jumped more than 5 per cent on news of its interest in TikTok. The retailer has experimented with video before, including venturing into movie streaming a decade ago when it bought Vudu, although it sold that platform earlier this year.
Its decision to partner with Microsoft on the bid shows it does not want to be distracted from its core business, said Neil Saunders, managing director of the GlobalData Retail consultancy.
“As large and competent as it is, Walmart is not primarily in the technology business,” he said. “This is one reason why a potential partnership with Microsoft makes good sense.”