Walmart enters fray to buy TikTok in US along with Microsoft

Beleaguered Chinese-owned video-sharing app TikTok got an unusual ‘marriage’ offer when, in a surprise move, US multinational retail corporation Walmart joined Microsoft to bid for buying the operations of the app in America.

TikTok has been under fire recently with US President Donald Trump threatening to stop its app from next month.

TikTok has a sizeable user base in the US but is facing resistance globally due to its ties with China. India was one of the first governments to ban the app. With elections round the corner in the US and with growing rhetoric against China, Trump is pushing TikTok’s Chinese owner ByteDance to sell its US business if it wants to keep operating in the country.

While Walmart’s decision to bid for the video app caught many off guard, the retailer’s ambitions shows that the decision is part of a long-term strategy to attract more young shoppers, advertisers and vendors.

It is obvious that Walmart wants to increase its customer base through TikTok. The retail giant believes it can scale its third-party marketplace and advertising businesses by joining hands with Microsoft and acquiring the video app.

“The way TikTok has integrated e-commerce and advertising capabilities in other markets is a clear benefit to creators and users in those markets. We believe a potential relationship with TikTok US in partnership with Microsoft could add this key functionality and provide Walmart with an important way to reach and serve omnichannel customers,” a Walmart spokesperson told Yahoo Finance.

“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 retailer said in a statement. Walmart’s shares were up about 4.4 percent after the news broke.

Microsoft and Walmart are not new to one another. Microsoft provides cloud computing services that help run the retailer’s stores and online shopping. The two companies signed a 5-year partnership in 2018, in a bid to counter shared rival Amazon.

In addition to Walmart and Microsoft, Oracle is also bidding for TikTok’s US operations along with a coalition of investors.

Meanwhile, chairman of ByteDance Zhang Yiming said the company is moving quickly to find resolutions to the issues it faces globally, particularly in the US and India. “I can assure you that we are developing solutions that will be in the interest of users, creators, partners, and employees,” he said.

ByteDance launched TikTok in 2017, then bought Musical.ly, a video service popular with teens in the US and Europe, and combined the two.