*

White House-led talks focus on non-Chinese bidders

*

Chinese government approval remains a major hurdle for

sale

(Adds ByteDance comment in paragraphs 5-7)

By Dawn Chmielewski, David Shepardson and Antoni Slodkowski

WASHINGTON/BEIJING, April 4 (Reuters) - A deal to spin

off the U.S. assets of TikTok was put on hold after China

indicated it would not approve the deal following President

Donald Trump's tariffs announcement this week, according to two

sources familiar with the matter.

Trump on Friday extended by 75 days a deadline for ByteDance

to sell U.S. assets of the popular short video app to a

non-Chinese buyer, or face a ban that was supposed to have taken

effect in January under a 2024 law.

The deal, the structure of which was largely finalized by

Wednesday according to one of the sources, would have spun off

TikTok's U.S. operations into a new company based in the U.S.

and majority-owned and operated by U.S. investors. ByteDance

would hold a position of less than 20%.

The deal had been approved by existing investors, new

investors, ByteDance and the U.S. government, the source said.

ByteDance said early on Saturday that differences remained

over the deal.

"(We are) still in talks with the U.S. government, but no

agreement has been reached, and the two sides still have

differences on many key issues," the company said in a statement

on its official account on Chinese social media platform WeChat.

"In accordance with Chinese law, any agreement is subject to

the relevant review procedures," it said.

The Chinese Embassy in Washington, asked about the status of

a deal for TikTok, said in a statement: "China has stated its

position on TikTok on multiple occasions. China has always

respected and protected the legitimate rights and interests of

enterprises and opposed practices that violate the basic

principles of the market economy."

The Associated Press was first to report China's

disapproval.

"The deal requires more work to ensure all necessary

approvals are signed," Trump said on social media, explaining

why he was extending the deadline he set in January that was

supposed to have expired on Saturday. "We hope to continue

working in good faith with China, who I understand is not very

happy about our reciprocal tariffs."

China now faces a 54% tariff on goods imported into the

United States after Trump announced he was hiking them by 34%

this week, prompting China to retaliate on Friday. Trump has

said he would be willing to reduce tariffs on China to get a

deal done with ByteDance to sell the app used by 170 million

Americans.

Trump has said his administration was in touch with four

different groups about a prospective TikTok deal. He has not

identified them.

A major stumbling block to any deal for TikTok's U.S.

business is Chinese government approval. China has not made a

public commitment to allow a sale and Trump's comments suggested

renewed Chinese opposition.

"We look forward to working with TikTok and China to close

the deal," Trump wrote on Friday.

"We do not want TikTok to 'go dark,'" Trump added.

Congress passed the measure last year with overwhelming

bipartisan support, as lawmakers cited the risk of the Chinese

government exploiting TikTok to spy on Americans and carry out

covert influence operations. Democratic then-President Joe Biden

signed it into law.

Some lawmakers have said Trump must enforce the law, which

had required TikTok to stop operating by January 19 unless

ByteDance had completed a divestiture of the app's U.S. assets.

Trump began his second term as president on January 20 and opted

not to enforce it.

The Justice Department in January told Apple ( AAPL ) and

Google that it would not enforce the law, which led

them to restore the app for new downloads.

The new Trump order will set a mid-June deadline for a deal.

The White House-led talks on the future of TikTok are

coalescing around a plan for the biggest non-Chinese investors

in parent company ByteDance to increase their stakes and acquire

the app's U.S. operations, Reuters has reported.

The plan entails spinning off a U.S. entity for TikTok and

diluting Chinese ownership in the new business to below the 20%

threshold required by U.S. law, rescuing the app from a looming

U.S. ban, sources have told Reuters.

Jeff Yass' Susquehanna International Group and Bill Ford's

General Atlantic, both of which are represented on ByteDance's

board, are leading discussions with the White House, Reuters has

reported.

Walmart ( WMT ) denied an ABC News report that it was also

considering joining a group of investors in a deal for TikTok.