TikTok Deal Delayed Amid Rising U.S.-China Trade Tensions

A potential deal to spin off TikTok’s U.S. operations has been delayed after China signaled it would reject the agreement due to newly announced U.S. tariffs. President Donald Trump extended the deadline for ByteDance to divest TikTok’s U.S. assets by 75 days, pushing it to mid-June. The deal, which would create a U.S.-based company majority-owned by American investors with ByteDance holding less than a 20% stake, had reportedly secured approval from ByteDance, current investors, and the U.S. government.

The Chinese Embassy reiterated its stance on protecting legitimate business interests and opposing actions that disrupt market principles. TikTok has not commented on the situation. According to sources, Trump’s recent move to increase tariffs on Chinese goods to 54% has led to pushback from Beijing, complicating the TikTok negotiations. China responded with retaliatory tariffs, raising concerns about the deal's viability.

The U.S. government has been in contact with multiple investor groups about acquiring TikTok’s American assets. Susquehanna International Group and General Atlantic, both ByteDance stakeholders, are reportedly leading the talks. Although Walmart was rumored to be involved, the company denied any participation.

The original divestment law was signed under former President Joe Biden and required TikTok to cease operations in the U.S. unless sold by January 19. However, Trump, now in his second term, chose not to enforce the ban, allowing TikTok to remain available through Apple and Google platforms. The current proposal aims to limit Chinese ownership in the restructured company to below 20%, aligning with U.S. regulatory requirements.

Trump expressed hope for a resolution, stating the goal is to prevent TikTok from being banned while working toward a deal with China. The delay underscores rising tensions in U.S.-China relations and the geopolitical stakes surrounding TikTok’s future.