ByteDance Is in Talks for $4 Billion in Loans as IPO Wavers

(Bloomberg) -- ByteDance Ltd. is in discussions for about $4 billion in bank loans, according to a person familiar with the matter, as a crackdown on China’s internet sector casts doubt over the timing of its much-anticipated initial public offering.

The TikTok and Douyin owner is in talks with several lenders on a syndicated loan of roughly $4 billion although that’s not finalized, the person said, confirming a debt financing earlier reported by The Information. ByteDance is taking advantage of low interest rates and will use the funds mostly to repay debt while replenishing its cash reserves for daily operations, the person said, asking to remain anonymous because the negotiations are private. A ByteDance representative declined to comment in a messaged statement.

ByteDance, the world’s most valuable startup, is among a clutch of Chinese corporate giants grappling with the unpredictability of a months-long government crackdown. Beijing’s assault on the tech sector, which spans social media and gaming to internet platforms, has cast a shadow over a startup once valued as highly as $500 billion in private transactions.

ByteDance, whose backers include SoftBank Group Corp. and Tiger Global Management, had kicked off preparations this year for an IPO of its domestic assets that could raise several billion dollars, Bloomberg News has reported. It’s been working with regulators to ensure compliance with data security requirements before going public, but proceeded cautiously given the regulatory turmoil.

At that time, it was choosing between Hong Kong and the U.S. as its listing venue. The company in March hired Shou Zi Chew from Xiaomi Corp. as its finance chief, fueling speculation an IPO was imminent.

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