Chinese firm ByteDance, owner of video-based social media sites TikTok and Douyin, seeks roughly $ 4 billion in loans as its initial public offering (IPO) is on hold amid continued government crackdown on tech companies in China, Bloomberg reported on Wednesday. (September 8).
While the company is in talks with various financial institutions (FIs), nothing has been decided, an anonymous source reportedly told Bloomberg. If borrowed funds are available, the business can take advantage of low interest rates while paying off debt and replenishing cash reserves.
Amid increasing scrutiny from regulators in China, the company recently agreed to scale back its FinTech operations and cut back on its securities brokerage business. ByteDance manages Songshu Zhengquan – translated by Squirrel Securities – in Hong Kong, as well as Haitun Gupiao – translated by Dolphin Stocks – in mainland China.
Read more: TikTok Parent ByteDance Minimizes FinTech Biz and Creates Stock Trading Unit
The world’s most valuable startup, ByteDance, had a valuation in private transactions of $ 500 billion and backing from investors that include SoftBank Group and Tiger Global Management, according to the report. Its IPO plans are on the back burner as the company works with regulators in China.
Public listing could be in Hong Kong or the United States. The company works with Shou Zi Chew of Xiaomi Corp. as chief financial officer, Bloomberg reported.
ByteDance aimed to raise $ 2 billion last year to a valuation of $ 180 billion. The round was led by Sequoia Capital and KKR. Based in Beijing, the startup was launched in 2012 and was valued at $ 78 billion in 2018.
Read more: ByteDance valuation to hit $ 180 billion as TikTok owner considers IPO for Douyin
The Chinese tech company started selling artificial intelligence (AI) from its TikTok app to other companies beyond China through BytePlus in July. The company also sells language translation software for text and speech as well as data analysis tools.
Read more: ByteDance allows other businesses to buy TikTok AI Tech