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Perplexity submits new bid to merge with TikTok

Perplexity AI proposes merging with TikTok, offering the U.S. government up to 50% ownership in a deal shaped by Trump administration demands.

Perplexity AI has submitted a revised proposal to merge with TikTok, offering the U.S. government up to 50% ownership of the new entity.

In an updated bid, Perplexity AI, the AI-powered search engine, has proposed a new structure that combines Perplexity, TikTok U.S., and additional equity investors into a single company.

Under the revised plan, the U.S. government would gain up to a 50% stake in the newly created company following an initial public offering (IPO) valued at a minimum of US$300 million. According to reports, TikTokโ€™s Chinese parent company, ByteDance, would still retain partial ownership.

Proposal shaped by U.S. administration feedback

Perplexityโ€™s updated bid responds to the Trump administration’s concerns about TikTokโ€™s operations and potential risks to national security. These concerns initially prompted the administration to push ByteDance to divest from TikTokโ€™s U.S. operations or face a nationwide ban.

President Donald Trump previously stated his desire for the U.S. government to receive a significant share of any deal involving TikTok, specifying a โ€œ50% ownership.โ€ However, whether this ownership would belong directly to the government or U.S. investors remains unclear.

The revised proposal aligns with the administration’s demands while allowing ByteDance to maintain some level of involvement. The arrangement also hinges on a planned IPO that would generate substantial capital for the new company while solidifying the governmentโ€™s stake.

TikTokโ€™s turbulent weekend and other potential deals

TikTok users experienced a brief outage last weekend as the company faced mounting pressure over an impending sale deadline. ByteDance risked being forced to sell TikTokโ€™s U.S. operations entirely or see the app banned in the United States. The situation eased after President Trump indicated he would extend the deadline, signing an executive order to delay the sale.

Meanwhile, other potential deals for TikTok remain in play. Reports suggest the White House has also discussed the possibility of Oracle taking control of TikTokโ€™s U.S. operations. Oracle, which already provides the infrastructure for TikTokโ€™s U.S. traffic, is reportedly considered a key player in the negotiations.

When questioned about the possibility of an Oracle deal, President Trump stated he had spoken with โ€œmany people about TikTokโ€ but had not had direct discussions with Oracle.

The unfolding negotiations underscore the situation’s complexity, as the Trump administration seeks to address national security concerns while preserving access to TikTok for millions of U.S. users.

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