Former U.S. Treasury Secretary Steven Mnuchin is organizing an investor consortium to buy TikTok from its parent company ByteDance Ltd.

Mnuchin, who is the managing director of private equity firm Liberty Strategic Capital, detailed the effort in an interview on CNBC today. Asked whether the investor group has already been assembled, he responded, “I’m working on it. I’ve spoken to a bunch of people.” Mnuchin didn’t specify who may participate in the consortium or the value of a potential TikTok acquisition.

On Wednesday, the House of Representatives passed the Protecting Americans from Foreign Adversary Controlled Applications Act with a 352-65 vote. If it becomes law, the bill will ban TikTok in the U.S. unless it separates from ByteDance within 180 days. Any company that will distribute, maintain or provide hosting services to the app following that deadline will face steep fines.

It’s unclear whether a sale of TikTok would materialize if the bill becomes law. In today’s interview, Mnuchin said that he believes the Chinese government “will be fine selling it so long as there’s not a technology transfer along the way.” However, analysts cited by CNBC expressed skepticism that a deal would receive approval in China.

Another open question is what price a sale might fetch. TikTok parent ByteDance reportedly received a $220 billion valuation following a funding round last year. According to a new report from The Information, investors estimate that TikTok incurred a multibillion-dollar loss in 2023 last year on revenues of about $20 billion.

Mnuchin told CNBC that if a deal happens, “the app needs to be rebuilt in the U.S., it needs to be U.S. technology.” He didn’t specify which of the app’s components would be changed. TikTok already hosts parts of its infrastructure stateside: in 2022, it launched an effort to move the data of U.S. users to Oracle Corp.’s public cloud.

Mnuchin’s private equity firm, Liberty Strategic Capital, launched in 2021 and has acquired at least one technology company. Last March, it inked a deal to buy Zimperium Inc. for about $525 billion. Zimperium provides software tools that help companies build more secure mobile apps and protect employee handsets from hacking.

More recently, Liberty Strategic Capital teamed up with several financial institutions to invest $1 billion in NYCB Inc., a New York-based bank.

Mnuchin’s potential bid for TikTok may face competition. On Sunday, the Wall Street Journal reported that video game executive Bobby Kotick has also floated the idea of assembling an investor group to buy the app. Kotick is the former chief executive of Activision Blizzard Inc., a major game developer that Microsoft Corp. acquired for $68.7 billion last year. 

Image: TikTok