UAE’s G42 buys $100 million share in China's ByteDance, parent of TikTok

DUBAI — Abu Dhabi’s AI firm G42 recently bought a $100 million stake in TikTok owner ByteDance, which is valued at $220 billion, according to a Bloomberg report on Wednesday. 

ByteDance’s value has been fluctuating and saw a major $80 billion drop recently, predominantly due to investor uncertainty caused by Washington’s consideration of banning TikTok in the United States, with US lawmakers citing national security concerns. 

The Chinese company was valued last year at $300 billion, or $170 per share, in the private-equity secondary market, down from a height of $400 billion in 2021. 

ByteDance, considered one of the world’s most valuable private tech companies, launched a number of incentive plans in 2022 including stock option-granting programs at a lower price during increasingly slowing revenue growth, which fell to 70% in 2021 from more than 100% the year before. 

The TikTok leadership has been reportedly discussing the possibility of separating from its Chinese parent to rectify the loss in trust as a last resort. 

Sheikh Tahnoon bin Zayed Al Nahyan is the chairman of G42 and also the United Arab Emirate’s national security adviser. Last week, he was named chairman of the Abu Dhabi Investment Authority, which is one of the world’s largest sovereign wealth funds, valued at an approximate $993 billion in assets by Global SWF, while the Sovereign Wealth Fund Institute estimates it at $790 billion. 

He also chairs ADQ, Abu Dhabi’s third-largest investment fund, the International Holding Company and the First Bank of Abu Dhabi. 

ByteDance’s valuation in the G42 transaction does not reflect the anticipated potential impact of the Silicon Valley Bank collapse on Friday, shocking the United States, China and Gulf states. 

Several Middle Eastern stock indexes fell slightly on Monday on the back of the news, according to market data. 

The Royal Group investment firm, owned by Sheikh Tahnoon, considered purchasing the British arm of Silicon Valley Bank, Bloomberg reported on Sunday. However, the British bank HSBC ultimately bought the bank’s British arm on Monday, according to the BBC.