Triller Inc, a genuine competitor to current favourite short-video app TikTok, is in talks with blank-check acquisition companies in regards to a merger that would take the US social network company public, according to individuals familiar with the issue.
The deal would come as Triller attempts to capitalize on TikTok’s woes. President Trump’s government has arranged TikTok’s Chinese parent ByteDance to divest the app, citing concerns that the information on US citizens could be accessible to China’s Communist Party. TikTok has sued the US government to stave off a ban from US app stores while deal discussions continue.
Triller, which was founded back in 2015 and has just a fraction of the 100 million, or so users that TikTok boasts in the US, has said it expects that the uncertainty over its rival’s future will drive greater influencers and users to its own platform.
Triller is operating together with investment bank Farvahar Partners since it negotiates a possible deal with a so-called particular purpose acquisition companies (SPAC), the sources stated. A SPAC is a shell company that raises money in an initial public offering (IPO) to unite with a privately held company which then becomes publicly traded as a outcome.
Triller’s SPAC negotiations are happening together with talks with investors about a private fundraising around, led by investment bank UBS, in which the Los Angeles-based company is seeking to raise around $250 million, the sources said.
Triller has thus far secured around $100 million in that round, at a $1.25 billion, according to the sources. It is deliberating whether to carry on with the personal fundraising or choose the deal with a SPAC, among the sources included.
The sources cautioned that no deal is sure and asked to not be identified as the discussions are confidential.
Farvahar Partners and UBS didn’t immediately respond to requests for comment.
SPACs have emerged as a popular IPO choice for companies this year, providing a route to going people with less regulatory scrutiny and much more certainty over the evaluation which will be achieved and funds which will be raised. US SPACs have increased $53.8 billion so far in 2020 through IPOs, more than the total raised in the prior seven years, according to industry tracker SPAC Research.
Triller stated earlier this season it had 65 million active users onto its own brief video app, although many analytics firms have said they have never been provided enough access to independently confirm Triller’s figures.
Triller’s celebrity users include musicians Alicia Keys, Cardi B and Eminem, and its financial backers include Kendrick Lamar and The Weeknd.
Triller is owned by media industry veteran Ryan Kavanaugh and healthcare executive Bobby Sarnevesht. The studio ended up filing for bankruptcy twice, in 2015 and 2018.
Sarnevesht was a partner at Bay Area Surgical Management, which dropped a $37.4 million legal battle against Aetna following the medical insurance company alleged in 2012 that it had been defrauded from the operation centres operator.
BID FOR TIKTOK
Triller sued TikTok back in July, alleging it infringed its patent for stitching together multiple audio videos using a single audio track.
In August, Triller said it had partnered with investment firm Centricus Asset Management in a bid to get TikTok. ByteDance, however, said it was not engaged in these discussions.
Trump last month said he’d given his preliminary blessing to a deal which would provide a 20% stake in TikTok to monitor networking conglomerate Oracle Corp and retail giant Walmart. The discussions subsequently stalled, as ByteDance maintained it’d keep an 80% stake in TikTok, as opposed to disperse it to its own investors.
TikTok is broadly popular with US teens, though its advertising business is still understated. Important companies, including Procter & Gamble Co and Chipotle Mexican Grill told journalists at our partner news agency Reuters last week they would keep spending on advertising using TikTok despite the uncertainty over its future.
The team at Platform Executive hope you have enjoyed the ‘[post_title]’ article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Joshua Franklin and Echo Wang in New York. Editing by Greg Roumeliotis and Lisa Shumaker.
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