TikTok parent Bytedance to repurchase up to $3bn in shares

ByteDance is offering to buy back up to $3 billion worth of shares from investors at $176.94 apiece, according to multiple media outlets, which cited a ByteDance memo, on Friday (September 16).

Reuters reported that ByteDance was valued between $300 billion and $400 billion in the private-equity secondary market last year, while Crunchbase in February said the company is valued at $180 billion.

Sources told The Wall Street Journal that the company may repurchase an equal proportion of shares from each investors participating in the buyback program. ByteDance’s backers include Japan’s SoftBank Group, Sequoia Capital, General Atlantic, Hillhouse Capital Group, and Susquehanna International Group.

The repurchase program is reportedly expected to be completed within the next two to three months.

To boost shareholder returns, ByteDance is also planning to extend its existing employee stock incentive plan for 10 more years, a plan that has already secured board approval but is still subject to a shareholder vote at the end of the month, the WSJ reported, citing people familiar with the proposal.

The plans come as ByteDance seeks to keep shareholders happy after the company shelved its IPO plans.

Rumors about ByteDance’s IPO plans go as far back as 2020. In August 2021, the Financial Times reported that the TikTok parent’s debut would happen in early 2022.

Back in May, the South China Morning Post reported, citing a Chinese news outlet, that ByteDance renamed some of its subsidiaries, adding the “Douyin” brand, including one based in Hong Kong where the company reportedly plans to go public. Douyin is the Chinese version of TikTok.

The rebranding reportedly renewed speculation that ByteDance could soon launch its IPO, although a deal has yet to come to fruition after years of speculation.

ByteDance, ranked as the world’s most valuable unicorn, has quickly grown to become a global social media giant as it branched out of its legacy short-form video platform and into other potential revenue streams including launching a new music streaming service called Qishui Yinyue in China, according to the SCMP earlier this year.

An IPO would help ByteDance expand its reach globally and extend its product offerings. However, Beijing’s tech crackdown and difficulties in listing overseas, including on New York bourses, is making it harder for the company to realize its ambitions.Music Business Worldwide