Billionaire Frank McCourt wants to buy TikTok, but the sale could be difficult

If TikTok’s parent company, Chinese company ByteDance, was forced to sell the app, who would buy it?

ByteDance said a sale was not feasible. The Chinese government has indicated it would block a sale if it included the algorithm that makes TikTok extremely valuable. Even if Beijing were to allow a sale, any deal for TikTok involving its algorithm would be expensive: Research firm CB Insights recently estimated ByteDance’s value at $225 billion, though it’s less clear how much the U.S. version of TikTok would cost its own.

The price would most likely limit the pool of potential buyers to a coalition of private equity firms; a corporate giant like Microsoft; or a combination of both. Such a large acquisition by a major tech company would likely raise antitrust concerns, although a buyer could try to appeal to President-elect Donald J. Trump, who has vowed to protect the app.

Still, at least one suitor has thrown his hat into the ring to buy TikTok without its algorithm: billionaire Frank McCourt, who sent ByteDance a letter on Thursday proposing a deal. Mr. McCourt’s interest in acquiring TikTok follows his previous efforts to reimagine the internet. He has said he hopes to run TikTok with a focus on privacy and safer use of data.

Mr. McCourt, the former owner of the Los Angeles Dodgers, said in an interview this week that his advisers, which include investment bank Guggenheim Securities, value TikTok without its algorithm at around $20 billion – or roughly the social’s market value Media company Snap. Private equity funds, family offices and high-net-worth individuals, including “Shark Tank” star Kevin O’Leary, have indicated they would invest in the deal, he said. He has also secured outside financing.

Mr. McCourt said he had spoken to nearly “all of ByteDance’s investors,” but declined to specify which ones. “They’re just as in the dark as we are” about ByteDance’s plans, he said. ByteDance’s largest US backers include investment firms General Atlantic, Susquehanna and Sequoia Capital, with billions of dollars at stake.

Representatives for Susquehanna and Sequoia did not respond to a request for comment. General Atlantic declined to comment.

The last time ByteDance tried to sell TikTok during Mr. Trump’s first term, the company nearly struck a deal with Oracle and Walmart. TikTok continues to store US data on Oracle’s servers to address national security concerns. Oracle co-founder Larry Ellison is a long-time Trump supporter and could potentially help with sales pitches. It’s not clear whether Oracle or Walmart will re-enter the fray.