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Exclusive | ByteDance raises stock-option offer for employees amid talk of Hong Kong IPO, sources say

  • Valuation of the Chinese owner of TikTok has surged over the past 12 months
  • The Beijing-based start-up, currently the world’s highest-valued unicorn, has reportedly set in motion a Hong Kong IPO

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The logo of ByteDance, the China-based company which owns the short video apps TikTok and Douyin, is seen at its office in Beijing, China, on July 7, 2020. Photo: Reuters
Coco Feng

ByteDance has more than doubled its internal valuation in a new stock option plan for employees, as strong performance by its short video-sharing platform TikTok raised optimism about its business outlook, according to three people with knowledge of the matter.

The company has offered employees the option of exchanging their bonuses for ByteDance’s untraded stocks at US$126 per share, compared with last year’s offer of under US$50, according to the people. In 2019, the price was US$44, according to Chinese media 36Kr.

The valuation of the Beijing-based online entertainment start-up has drawn increasing interest amid reports that it is planning an initial public offering.

People walk past a logo of ByteDance at its office in Beijing, China, on July 7, 2020. Photo: Reuters
People walk past a logo of ByteDance at its office in Beijing, China, on July 7, 2020. Photo: Reuters

ByteDance has notified the operator of the Hong Kong stock exchange that it had appointed securities underwriters, China Securities Journal reported on Wednesday. Firms are required to appoint sponsors and underwriters at least two months before submitting an IPO application.

In February, the Post reported that ByteDance was mulling a US listing for Douyin, the Chinese sibling app of TikTok, and last month, Reuters reported that the company was in talks over a possible debut for Douyin in New York or Hong Kong.

ByteDance did not immediately respond to a request for comment on Wednesday.

The latest stock-option price for employees represents a discount of roughly 30 per cent from the offer of US$180 under a share-buy-back plan offered to resigning employees last month, which put the valuation of ByteDance at US$270 billion, the South China Morning Post reported earlier this month.
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