Perplexity AI TikTok Merger: Latest News & Details

Perplexity AI Enters Bid for TikTok US Amid Potential Ban

Facing a possible prohibition in the United States, TikTok is attracting interest from potential buyers, with Perplexity AI now emerging as a contender.

Perplexity AI Submits a Merger Proposal

Initial reports from CNBC highlighted Perplexity’s intention to acquire TikTok US. A source familiar with the offer has verified to TechCrunch that Perplexity, led by CEO Aravind Srinivas, has formally submitted a bid for a merger with TikTok US.

The proposed arrangement would involve the creation of a new corporate structure. This new entity would integrate Perplexity, TikTok US operations, and contributions from additional equity investors.

Equity Retention and Strategic Goals

A key aspect of the bid is the potential for ByteDance’s existing investors to maintain their equity holdings. Perplexity anticipates that this merger will facilitate the incorporation of more video content into its AI search engine.

Impending Deadline and Political Landscape

A legislative mandate requiring ByteDance to divest TikTok or face a US ban is scheduled to come into effect on January 19th. This date coincides with President Joe Biden’s final day in office.

Administration officials have indicated that the responsibility for enforcing the ban will be deferred to the incoming administration. President-elect Donald Trump has suggested he would “most likely” grant TikTok a 90-day extension, a gesture acknowledged by TikTok’s CEO.

TikTok's Response and Potential Shutdown

However, TikTok has stated that, absent definitive assurances regarding non-enforcement from the current administration, the platform will be “forced to go dark” on Sunday.

ByteDance's Stance and Merger Strategy

Despite reported interest from various parties, ByteDance has consistently expressed its unwillingness to sell TikTok. The company previously dismissed claims of Chinese government approval for an acquisition by Elon Musk as unfounded.

Perplexity is reportedly attempting to circumvent these reservations by proposing a merger, rather than a traditional sale.

Seeking Official Confirmation

TechCrunch has contacted both TikTok and Perplexity AI for official statements regarding this developing situation.

Further Details on the Proposed Deal

• The deal aims to create a new company combining the strengths of both platforms.
• Existing ByteDance investors could potentially retain their stakes.
• AI-powered search could be enhanced with video content from TikTok.

The future of TikTok in the US remains uncertain as the January 19th deadline approaches.