Tag: Mergers, Acquisitions and Divestitures

TikTok Fight Cast Shadow Over Investments in Other Chinese Companies

Media Library

When investors talk about “zombie” companies, they’re usually referring to distressed start-ups that are hobbling along, unable to grow and unlikely to ever return the money they’ve raised. But as deal makers feverishly debated efforts this week by lawmakers to force TikTok’s Chinese parent company, ByteDance, to sell the app, they talked about a new version: China zombies. China zombies may have booming businesses, but they’re unlikely to provide investors with any immediate return because they’re stuck in geopolitical cross hairs. It’s not just the investors in ByteDance who, after…

TikTok Bill’s Progress Slows in the Senate

Media Library

After a bill that would force TikTok’s Chinese parent company to sell the app or face a nationwide ban sailed through the House at breakneck speed this week, its progress has slowed in the Senate. Senator Chuck Schumer of New York, the Democratic leader who determines what legislation gets a vote, has not decided whether to bring the bill to the floor, his spokesman said. Senators — some of whom have their own versions of bills targeting TikTok — will need to be convinced. Other legislation on the runway could…

What China Is Saying About the TikTok Furor in Washington

Media Library

This is not the first time that China has seen a frenzy over TikTok consume Washington. In 2020, former President Donald J. Trump issued an executive order that would have forced TikTok’s Chinese owners to sell the popular app. But Beijing foiled a takeover bid by American buyers by slapping curbs on technology exports. Last year, Montana lawmakers enacted a ban on TikTok in the state, but the law was blocked by a federal judge before it could take effect. Now, U.S. lawmakers are again attempting to force ByteDance, TikTok’s…

TikTok’s Security Threats Go Beyond the Scope of House Legislation

Media Library

In a capital where Republicans and Democrats agree on virtually nothing, it was notable when the House overwhelmingly declared on Wednesday that TikTok poses such a grave risk to national security that it must be forced to sell its U.S. operations to a non-Chinese owner. But that glosses over the deeper TikTok security problem, which the legislation does not fully address. In the four years this battle has gone on, it has become clear that the security threat posed by TikTok has far less to do with who owns it…

U.S. House Passes Bill That Could Ban TikTok

Media Library

The House on Wednesday passed a bill with broad bipartisan support that would force TikTok’s Chinese owner to either sell the hugely popular video app or have it banned in the United States. The move escalates a showdown between Beijing and Washington over the control of a wide range of technologies that could affect national security, free speech and the social media industry. Republican leaders fast-tracked the bill through the House with limited debate, and it passed on a lopsided vote of 352 to 65, reflecting widespread backing for legislation…

China Condemns U.S. Proposal to Force the Sale of TikTok

Media Library

China on Wednesday condemned U.S. lawmakers’ push to force the Chinese parent company of TikTok to sell the popular short video platform. In Washington, House lawmakers were expected to vote on a bill later in the day that would require the Chinese internet company ByteDance to cut ties with TikTok or face a nationwide ban. Lawmakers say that Beijing could use TikTok to spread Chinese Communist Party messages or gain access to sensitive data about TikTok’s American users. Beijing rejected concerns that the app was a danger to the United…

What to Know About the TikTok Ban Legislation

Media Library

House lawmakers are expected to vote starting at around 10 a.m. on Wednesday on legislation meant to force ByteDance, the Chinese internet company, to sell its wildly popular social media app TikTok. The vote would be the latest development in a yearslong cold war between the United States and China over who controls valuable technology from computer chips to artificial intelligence. Lawmakers and the White House have expressed concerns that TikTok’s Chinese ownership poses a national security risk because Beijing could use the app to gain access to Americans’ data…

Shein and Forever 21 Team Up in Fast-Fashion Deal

Media Library

Shein, the e-commerce retailer founded in China, is teaming up with the parent of Forever 21 to expand its reach into Americans’ closets. The tie-up will bring together two of the biggest names in the fast-fashion sector online and in malls across the country. As part of the agreement, Shein could one day operate stores-within-stores at Forever 21 outlets, while Forever 21’s clothes would be sold on Shein’s site. The deal also includes investments from each partner in shares of the other. In the early 2000s, Forever 21 helped popularize…

Intel Acquisition of Tower Semiconductor Is Scuttled by China

Media Library

China has effectively scuttled a $5.4 billion deal by Intel, the Silicon Valley semiconductor giant, in the latest sign of the frayed business ties between China and the United States. Intel, which has long had operations in China, said Wednesday that it had “mutually agreed” to terminate a planned merger with Tower Semiconductor, an Israeli chip manufacturer. The announcement came after China’s antitrust regulators failed to rule on the transaction before a deadline set by the companies. The failure of Intel to complete the acquisition of Tower could send a…

Pulling the Plug on TikTok Will Be Harder Than It Looks

Chin@Strategy

In the summer of 2020, in full re-election mode and looking for new ways to punish China, President Donald J. Trump threatened to cut off TikTok from the phones of millions of Americans unless its parent company agreed to sell all of its U.S. operations to American owners. The effort collapsed. Now, more than two years later, after lengthy studies of how Chinese authorities could use the app for everything from surveillance to information operations, the Biden administration is attempting a strikingly similar move. It is better organized, vetted by…