Chinese firm ByteDance, owner of video-driven social media sites TikTok and Douyin, is looking for roughly $4 billion in loans as its initial public offering (IPO) hangs in the wings amid the continuing government crackdown on technology companies in China, Bloomberg reported Wednesday (Sept. 8).
While the company is in discussions with various financial institutions (FIs), nothing has been decided, an unnamed source reportedly told Bloomberg. If the borrowed funds are a go, the company will be able to take advantage of low-interest rates while paying down debt and re-upping cash reserves.
Amid increasing oversight by regulators in China, the company recently agreed to curtail its FinTech operations and scale back its stock brokerage business. ByteDance runs Songshu Zhengquan — translated as Squirrel Securities — in Hong Kong, as well as Haitun Gupiao — translated as Dolphin Stocks — in mainland China.
Read more: TikTok Parent ByteDance Curtails FinTech Biz, Spins Off Stock Trading Unit
The most valuable startup worldwide, ByteDance had a valuation in private transactions of $500 billion and the backing of investors that include SoftBank Group and Tiger Global Management, per the report. Its IPO plans are on the back burner as the company works with regulators in China.
The public listing could be in Hong Kong or in the U.S. The company is working with Shou Zi Chew from Xiaomi Corp. as its finance chief, Bloomberg reported.
ByteDance was aiming to raise $2 billion last year at a $180 billion valuation. The round was being led by Sequoia Capital and KKR. Headquartered in Beijing, the startup launched in 2012 and was valued at $78 billion in 2018.
Read more: ByteDance Valuation to Hit $180B as TikTok Owner Eyes IPO for Douyin
The Chinese tech firm started selling the artificial intelligence (AI) driving its TikTok app to other companies beyond China via BytePlus in July. The company also is selling language translation software for text and speech as well as data analysis tools.
Read more: ByteDance Allows Other Companies to Buy TikTok AI Tech
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