Tesla bull Wedbush weighed the potential of CEO Elon Musk buying social media platform TikTok, which is set to be banned in the United States in less than a week.
Some are speculating that Musk could be an ideal buyer, as he has already purchased one platform in Twitter, which he changed to X. Last evening, a report from Bloomberg stated that sources close to the matter said China was mulling Musk as a potential buyer of the platform to keep it running in the U.S.
With the stories persisting and many looking at how Musk could purchase the platform, Wedbush’s Dan Ives published a note on Tuesday morning driving home the idea that the Tesla frontman being at the helm of TikTok could make sense:
“Given the strong and growing alliance between Trump and Musk this is not a total shock route as behind the scenes the Trump White House is looking at alternatives if the Supreme Court upholds the ban. In addition, Beijing/Xi Jinping has a strong relationship with Musk so there would be added comfort in this deal/potential partnership to avoid a TikTok ban in our view.”
Ives details the idea that President-elect Donald Trump’s desire to “save” TikTok could directly tie into his relationship with Musk, who could purchase the platform. It could also be a potential political move on Trump’s end as it could bring relations with China to a healthy level as he takes office.
The analyst then goes on to talk about the potential pricing of the platform as well as its potential to bolster strength within X, as it could integrate TikTok as a feature:
“We believe in the scenario that ByteDance sold the US operations of TikTok this would be without the algorithm (ByteDance will never sell this key DNA) at a price tag likely in the $40 billion to $50 billion range. This would significantly enhance the value of Twitter/X platform and likely Musk would take outside investments for this potential golden asset pickup. It’s also possible that instead of an outright sale this results in a joint partnership with Musk playing a major role and helping avoid a true ban of TikTok in the US.”
In what would be a transaction that would need plenty of negotiations, Ives sees TikTok being sold for between $40 billion and $50 billion, and integrating it into the X app would be monumental for its valuation. All in all, a purchase by Musk or anyone else could be the only way TikTok works around a ban in the U.S.
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