Perplexity AI makes a bid to merge with TikTok U.S.

Perplexity AI officially made a play for TikTok on Saturday, submitting an offer to its parent company, ByteDance, to create a new merged entity combining Perplexity, TikTok US and new equity partners, CNBC has learned.

The new structure would allow most of ByteDance’s existing investors to retain their equity stake and would bring more video to Perplexity, according to a source familiar with the situation, who asked to remain anonymous because of the confidential nature of the potential deal.

Perplexity AI, the artificial intelligence search engine startup competing with OpenAI and Googlestarted 2024 with an approx $500 million rating and ended the year with a rating of about $9 billionafter attracting growing investor interest in the generative AI boom—and yet controversy over accusations of plagiarism.

AI-assisted research has been seen by investors as one of Google key risks, as it potentially changes the way consumers access information online. Last year, OpenAI, which started the generative AI craze in late 2022 with ChatGPT, introduced a search engine called SearchGPT. Google later launched “AI Overviews” in search, which allows users to see a quick summary of answers at the top of the results.

Although any potential transaction between Perplexity AI and ByteDance would likely take months to complete — and TikTok he said app to ‘go dark’ in US on Sunday unless Biden administration assures it won’t punish AppleGoogle and other hosting service providers – President-elect Donald Trump he told NBC News on Saturday that he would “probably” give TikTok 90 more days to make a deal after being sworn into office on Monday.

In a video posted on TikTok on Friday, CEO Shou Zi Chew said: “I want to thank President Trump for his commitment to working with us to find a solution that will keep TikTok available in the United States.”

ByteDance has publicly implicated him will not sell TikTok US, which is part of why Perplexity AI believes it has a shot with its offer – since the proposal is a merger rather than a sale, the source told CNBC.

The source believes that a fair price is “well north of $50 billion”, but that the final number attached to the proposal will be decided, in part, by which of ByteDance’s existing shareholders want to remain part of the new entity and who want to cash out. .

CORRECTION: Perplexity’s AI bid for TikTok will create a new merged entity combining Perplexity, TikTok US and new equity partners. An earlier version of this article misstated one of the participants.