What's the best way to quiet noisy shareholders clamoring to exit their investment when a high-growth company has no imminent plans for an IPO a decade after its founding? If your name is ByteDance Ltd., the answer appears to be offering to buy out some of those investors by drawing on your own large cash store.
Arguably the world’s biggest tech company that no one has ever heard of, ByteDance, best known globally for its TikTok short video service, has been the subject of numerous IPO rumors in the last few years. But after those plans repeatedly stalled, the company has reportedly made a recent proposal to its existing shareholders to buy back its shares at up to $177 each over the next two to three months – a price that values ByteDance at about $300 billion.
Such an eye-popping figure isn’t new. Last year the company was valued at $300 billion to $400 billion based on trades in the secondary market. While the new buyout price is at the low end of that range, the figure has firmly cemented the social media platform with more than 1 billion users as the world’s undisputed biggest “unicorn” – generally defined as young companies worth more than $1 billion. The next biggest company in that class is SpaceX, the space exploration technology startup founded by the world's richest man Elon Musk, which was worth “just” $127 billion at the time of its latest funding in May.