In addition to Twitter’s attention, two familiar people told Reuters that through the Chinese owner TikTok’s ByteDance group, experts asked concerns about the willingness of Twitter to gather funds for a possible contract.
Such a groundbreaking transaction in the four-four-fifth days that US President Donald Trump has offered the chance to decide to sell, the sources said on Saturday, could not be missed by Facebook.
The Wall Street Journal posted earlier on reports that Facebook and TikTok are still being negotiated and that Microsoft is now regarded as the pioneer in the bidding of US apps.
Twitter has a market capitalization of almost $30 billion, nearly equal to the estimates of TikTok ‘s assets to be distributed, and the sources indicate that additional funds would have to be raised to finance it.
“Twitter will have a hard time putting together enough financing to acquire even the U.S. operations of TikTok. It doesn’t have enough borrowing capacity”, said Erik Gordon, a professor at the University of Michigan.
“If it (Twitter) tries to put together an investor group, the terms will be tough. Twitter’s own shareholders might prefer that management focus on its existing business”, he added.
One Twitter investor, the Silver Lake private equity group, would like to help finance a future offer, said one of the sources.
The sources also reported that Twitter had privately argued that its offer was less under regulatory review than Microsoft and that it was not under China’s threat, as it was not operating inside the region. The commentary was refused by TikTok, ByteDance and Twitter.
TikTok has shot on national security fears over data gathering by U.S. legislators.
Earlier this week, Trump announced U.S. trade sanctions with China-based chat device operators WeChat and TikTok that exacerbate friction between them.
Trump said this week he would support Microsoft’s efforts to buy TikTok’s U.S. operations if the U.S. government got a “substantial portion” of the proceeds. He nevertheless said he will ban the popular app on Sept. 15.
Microsoft said it hopes to reach a agreement by mid-September on Sunday.