"AI Startup Purple Lexity Proposes Merger With TikTok U.S. Corporation"

Amid the imminent ban on Chinese video-sharing site TikTok's service in the U.S., artificial intelligence start-up "Purplexity AI" has proposed a merger with TikTok's U.S. subsidiary to TikTok's parent company, according to reports.

U.S. economic outlet CNBC quoted a source as saying PurpleLexity has submitted a proposal to TikTok parent company ByteDance to form a new corporation through a merger with the company, TikTok's U.S. arm and investment firm New Capital Partners.

The proposal said the new structure would allow most of ByteDance's existing investors to keep their stake intact, while PurpleLexity would receive more video content.

PurpleLexity is an AI search engine startup competing with ChatGPT developers OpenAI and Google, with an enterprise value of 13.13 trillion won at the end of last year amid the Generative AI boom.

ByteDance has publicly indicated it will not sell its TikTok U.S. arm, which PurpleLexity has offered to merge, not sell.

The deal is estimated to be worth 72 trillion won, with the deal expected to take months to close between Purple Lexity and ByteDance.

The final deal size will depend on who will join the new corporation among ByteDance's existing shareholders and who will clean up the stake, the sources explained.