Microsoft Corp. (MSFT) - Get Report shares edged lower Tuesday after President Donald Trump intervened, and potential suitors emerged, in the planned sale of TikTok's U.S. operations over the coming weeks.
President Trump said late Monday that the U.S. government should receive a "substantial portion" of the sale proceeds if Microsoft, or any other firm, agrees to the short-video app's estimated $50 price tag.
Microsoft said Sunday that it's looking at buying TikTok's U.S. business after President Trump ordered it divested amid concerns over data privacy linked to its China-based owners, ByteDance, following an investigation by Committee on Foreign Investment in the United States.
Trump has said the app , which has been downloaded over 175 million times in the United States alone and has 1 billion global users, will be banned in the U.S. if it's not sold by September 15.
"I did say that if you buy it, whatever the price is that goes to whoever owns it, because I guess it’s China essentially, I said a very substantial portion of that price is going to have to come into the Treasury of the United States because we’re making it possible for this deal to happen," Trump told reporters in Washington
Microsoft shares were marked 1.4% lower in early trading Tuesday to change hands at $213.63 each, a move that trims the stock's year-to-date gain to around 35.5%.
State-backed newspaper China Daily, meanwhile, published an editorial warning of consequences of what it called a "smash-and-grab" from the President, a view that was echoed by Foreign Affairs spokesman Wan Wenbin.
“If following the wrong example set by U.S., every country could use national security as an excuse to target American companies,” Wang told reporters in Beijing. “The U.S. should not to open a Pandora’s box, otherwise it will swallow the bitter fruit itself.”
ByteDance's founder and CEO, Zhang Yiming, told employees in an internal letter Tuesday that the real aim of the move to force a sale of its U.S. assets was to ultimately ban the popular app, which has seen a more than 300% increase in American users since 2018.
ByteDance also said it is "considering establishing a TikTok headquarters in a major market outside the United States to better serve our global users."
CNBC, meanwhile, reported that other potential suitors -- two of them in the tech industry, one of which was described as 'serious' -- have emerged to challenge Microsoft's potential purchase.