Billionaire Frank McCourt Wants to Buy TikTok, but Selling It Could Be Difficult

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

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

The price would most likely limit the pool of potential buyers to a coalition of private equity firms; a corporate behemoth, like Microsoft; or a combination of the two. Such a large acquisition by a big tech company would be likely to raise antitrust concerns, though 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 tossed his hat in the ring to buy TikTok without its algorithm: the billionaire Frank McCourt, who sent ByteDance a letter on Thursday proposing a deal. Mr. McCourt’s interest in acquiring TikTok stems from his prior efforts to rethink the internet. He has said that 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 the investment bank Guggenheim Securities, are valuing TikTok without its algorithm at around $20 billion — or roughly the market value of the social media company Snap. Private equity funds, family offices and high-net-worth individuals, including the “Shark Tank” star Kevin O’Leary, have indicated that they would invest in the deal, he said. He has also secured debt financing.

Mr. McCourt said he had spoken with nearly “all the investors” in ByteDance, though he declined to specify which ones. “They’re as in the dark as we are” about ByteDance’s plans, he said. Some of ByteDance’s largest U.S. backers include the investment firms General Atlantic, Susquehanna and Sequoia Capital, and they have 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 sought to sell TikTok, during Mr. Trump’s first term, it nearly finalized a deal with Oracle and Walmart. TikTok continues to store U.S. data on Oracle’s servers as a way to address national security concerns. Oracle’s co-founder, Larry Ellison, is a longtime Trump supporter and could potentially help with any sale talks. It is not clear whether Oracle or Walmart will jump into the fray again.