TikTok in early talks with Reliance to sell its India business

Guwahati: Mukesh Ambani-controlled Reliance Industries (RIL) is reportedly in the initial stages of evaluating the possibility of investing in the Chinese short-form video-sharing app TikTok's India operations at this stage.

The development assumes importance against the background of ongoing talks by tech giant Microsoft to buy a controlling stake in the short-video platform's global operations before the September 15 deadline set by the Donald Trump administration.

TikTok chief executive officer (CEO) Kevin Mayer has reportedly recently approached senior RIL executives to determine if the oil-to-telecom conglomerate is interested in buying a stake in the app's India unit. Following this, RIL and its digital arm Jio's corporate development, strategy and M&A teams are weighing if any investment or acquisition is worthwhile at this stage, sources informed ET. The financial daily quoted an official as saying, "Both sides are in touch directly."

RIL, has, however, declined to comment on what it called "speculation and rumours". A spokesperson for RIL said, "Our company evaluates various opportunities on an ongoing basis. We have made and will continue to make necessary disclosures in compliance with our obligations under Sebi rules and our agreements with the stock exchanges."

Reliable sources stated that discussions are at a primary stage, and the deal is unlikely to happen due to the many obstacles. According to Sensor Tower data, India is TikTok's biggest market, with over 650 million downloads.

ByteDance, TikTok's parent company, is under tremendous international political pressure over security concerns and data-sharing practices. In June, India banned 59 applications with Chinese links, including TikTok, citing concerns about privacy and national security of the country. The ban has affected the app's 200 million registered users in India.

Sources said that TikTok's business could fetch an estimate of around $2.5-5 billion, or about 10 percent of the reported $50 billion estimates globally for the entire firm.

RIL is likely to wait and let Tik-Tok's valuation drop further, and then decide "strategically", rather than "rescuing a Chinese brand" at this stage, the publication mentioned, quoting an unnamed executive close to RIL.

Last week, the Financial Times (London) had reported that Microsoft was actively considering buying all of TikTok's global operations, including the Indian and European units. It also cited a person close to "Byte-Dance in India" as mentioning that if the US-based tech giant did not buy the Indian unit, the China-based firm could sell Tik-Tok's business in the country to other overseas or Indian buyers.

Meanwhile, news reports earlier mentioned that Jio Platforms and Kolkata-based industrial and services conglomerate RP-Sanjiv Goenka Group (PRSG) was being named as the frontrunners to buy TikTok's India business if the social media firm was put up for sale separately.