Perplexity AI Bids to Merge with TikTok U.S., Forming New Entity Amid Potential Ban

Jan 18, 2025, 09:25 PM

Perplexity AI has submitted a bid to merge with TikTok's U.S. operations, proposing the creation of a new entity that would combine Perplexity, TikTok U.S., and New Capital Partners. This move comes as TikTok faces a potential ban in the U.S. unless it severs ties with its Chinese parent company, ByteDance, by Sunday. The proposed structure would allow most of ByteDance's existing investors to retain their equity stakes and aims to integrate more video content into Perplexity's offerings. President-elect Donald Trump has indicated he might grant TikTok a 90-day extension to finalize a deal after his inauguration on Monday. Perplexity AI, valued at around $9 billion, sees this merger as a strategic opportunity, especially since ByteDance has hinted at not selling TikTok U.S. outright. The deal's potential value is estimated to be over $50 billion, though the final figure will depend on which ByteDance shareholders opt to stay with the new entity.