Perplexity AI Bids for TikTok U.S. Merger Amid Potential Ban

Perplexity AI, a U.S. search engine startup, has proposed a merger with TikTok U.S. as a potential ban looms. This proposal could preserve ByteDance's equity stakes while enhancing Perplexity's video offerings. The merger aims to avert a ban threatening TikTok's future in the U.S.

Amid looming threats of a U.S. ban, U.S.-based search engine startup Perplexity AI has made a significant move to merge with TikTok U.S., according to sources close to the development. The potential deal, first reported by CNBC, comes as President-elect Donald Trump considers a 90-day extension.

The proposed merger aims to create a new entity in conjunction with New Capital Partners. This strategic move would allow most existing ByteDance investors to retain their stakes, while augmenting Perplexity's offerings in video content. A source, requesting anonymity due to the sensitive nature of the information, mentioned that the merger is seen as a viable alternative to a sale.

Perplexity AI, known for its rapid-response search tools, is backed by large language models like those from OpenAI and Meta's Llama. Meanwhile, TikTok, having significantly impacted American online culture, faces a shutdown unless the Biden administration intervenes. TikTok has yet to comment on these developments.

(With inputs from agencies.)