Trump Official Wants to Buy TikTok

In a strategic move amid heightened U.S. scrutiny over TikTok, Steven Mnuchin, a key figure in the Trump administration and former treasury secretary, on Thursday announced on CNBC's Squawk Box his plans to assemble an investor group to acquire the social media giant.

The announcement follows Wednesday's House vote to push a bill that could lead ByteDance, TikTok's parent company, to divest the app to avoid a U.S. ban.

Mnuchin, who just last week led a deal that would see New York Community Bank receive a strategic equity investment exceeding $1 billion, sees the potential TikTok acquisition as a solution to national security concerns cited by lawmakers. While the Senate's stance on the bill remains uncertain, Mnuchin's initiative reflects a broader debate on the balance between national security and maintaining a competitive market.

During the interview with CNBC's Andrew Ross Sorkin, Mnuchin emphasized the strategic value of maintaining TikTok's operational independence, saying that no single investor or tech company would wield controlling influence over the platform.

"This is independent and I wouldn't let any tech company control this, so nobody would have more than 10 percent control," he said while illustrating his vision for a decentralized ownership model that mitigates risks associated with excessive influence or control by any one entity.

The approach would ensure that TikTok remains a competitive entity in the global tech landscape, free from the potential biases or strategic limitations that might arise from dominant ownership by a competitor.

Addressing the proposed acquisition, Mnuchin acknowledged the balance required to work through the geopolitical and technological tensions underlying the deal. He pointed out that resolving the "concerns of the U.S. and China to transfer this, without taking what they believe is critical technology," remains the chief challenge.

Mnuchin said his strategy involves negotiating with U.S. lawmakers and potential investors as well as engaging diplomatically with Chinese stakeholders to ensure a consensus that respects both countries' national security concerns and economic interests.

The ongoing legislative push in the U.S. to regulate or even ban TikTok adds urgency to Mnuchin's efforts. The House bill, coupled with President Joe Biden's willingness to sign the legislation, places TikTok on the hot seat, making Mnuchin's bid a high-stakes diplomatic endeavor.

TikTok CEO Shou Zi Chew, responding to the House's action in a social media post, voiced concern over the potential impact on the platform's vast community and economic contributions.

"This bill gives more power to a handful of other social media companies," Chew said, highlighting the bill's implications for competition within the digital landscape.

He mentioned the potential loss of billions in revenue and the jeopardy facing more than 300,000 American jobs tied to the platform's operations.

TikTok's community of more than 150 million active U.S. users and nearly 2 billion global users—excluding China, where TikTok operates under the name Douyin—finds itself at a crossroads.

The House vote, part of broader concerns about data privacy and national security risks associated with Chinese government influence, adds to a chorus of international calls scrutinizing TikTok's operations, Newsweek previously reported.

With TikTok already restricted on official devices in several countries and regions, including the U.S. federal government, Canada, the U.K., the EU and India, Chew's remarks resonate as a plea for reconsideration of measures that could reshape the digital and economic landscapes.