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China’s ByteDance, owner of TikTok, has seen its valuation surge to US$500 billion on the private market as it advances a survival plan in the US, up sharply from US$400 billion earlier this year, according to two sources.
With the deadline for a sell-or-ban law looming, TikTok CEO Chew Shou Zi informed employees last week that the company had signed a binding agreement to divest its US entity into a joint venture controlled by American investors.
“Investors are happy about the deal’s terms as ByteDance can continue to reap earnings from TikTok in the US,” said one of the sources, who is directly involved in the matter.
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ByteDance did not immediately respond to a request for comment.
The US$500 billion figure would mark a record for the short video and artificial intelligence giant. ByteDance’s valuation previously approached US$400 billion in April 2021, when the company considered a public listing for Douyin, TikTok’s Chinese sibling app, according to a Post report. Weeks later, the company said it had no immediate plans to go public.
ByteDance has signed a binding agreement to divest its US entity into a joint venture controlled by American investors. Photo: EPA alt=ByteDance has signed a binding agreement to divest its US entity into a joint venture controlled by American investors. Photo: EPA>
The valuation, which since then dropped, returned to US$400 billion in the second quarter this year as the company worked on the US deal and made progress in AI, the other source said. It rose further when a Chinese investment firm bought ByteDance shares at a valuation of US$480 billion, reflecting strong investor interest, Bloomberg reported in November.
The Beijing-based unicorn‘s valuation has followed a V-shaped trajectory in recent years amid political headwinds in the US and Europe. Both US President Donald Trump and his predecessor, Joe Biden, have targeted TikTok over national security concerns, with the latest law requiring divestment by January 23, 2026.
ByteDance has opted to form a new US joint venture, named TikTok USDS Joint Venture, which will take effect a day before the deadline. A consortium of American and allied investors – including Oracle, Silver Lake and Abu Dhabi-based MGX – will hold 50 per cent of the entity, with each owning 15 per cent. Affiliates of existing ByteDance investors will hold 30.1 per cent, while ByteDance will retain 19.9 per cent.
Despite the milestone, ByteDance – once the world’s most valued private company – trails some fast-growing peers in terms of valuation. OpenAI is reportedly seeking new funding that could value it at US$830 billion, the Wall Street Journal reported, while SpaceX, preparing for an initial public offering next year, was valued at US$800 billion during an insider share sale, Reuters reported earlier this month.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2025. South China Morning Post Publishers Ltd. All rights reserved.