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The Chinese-owned short-video app TikTok could be sold to Microsoft after an apparent change of mind by President Trump.
On Friday he said he intended to
ban TikTok
from the US because of concerns about the data of US users and appeared to dismiss the idea of a takeover by an American company.
The US has repeatedly warned of a security threat from Beijing and accused it of billions of dollars' worth of intellectual property theft. China has denied the claims.
But following a discussion between President Trump and Microsoft CEO Satya Nadell on Sunday, the tech giant said it had been given the go ahead to negotiate a complete buyout with TikTok's parent company ByteDance with discussions completed "no later than 15 September".
The negotiations will be overseen by the Committee on Foreign Investment in the United States, a government panel that has the right to block any agreement, according to the sources, who requested anonymity ahead of a White House announcement.
In a statement Microsoft said: "Microsoft fully appreciates the importance of addressing the President's concerns. It is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury."
Under the proposed deal, Microsoft said it would take over TikTok's operations in the United States, Canada, Australia and New Zealand.
It said it would "ensure that all private data of TikTok's American users is transferred to and remains in the United States".
It added: "To the extent that any such data is currently stored or backed-up outside the United States, Microsoft would ensure that this data is deleted from servers outside the country after it is transferred."
Microsoft said it may invite other American investors to acquire minority stakes in TikTok.
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President Trump's threat to ban TikTok is just the latest volley in the trade and security war between the US and China.
The US has long accused China of intellectual property theft which costs billions of dollars and thousands of jobs, something Beijing denies.
The other main concern is national security, with US Secretary of State Mike Pompeo having previously described Chinese state-backed tech companies as "Trojan horses for Chinese intelligence".
US military personnel have also been discouraged from using Chinese technology because of the security fears, while Democratic presidential candidate Joe Biden reportedly told staff not to use TikTok.
After President Trump's ban threat last week a TikTok spokesperson said: "These are the facts: 100 million Americans come to TikTok for entertainment and connection, especially during the pandemic.
"We've hired nearly 1,000 people to our US team this year alone, and are proud to be hiring another 10,000 employees into great paying jobs across the US.
"Our $1billion creator fund supports US creators who are building livelihoods from our platform. TikTok US user data is stored in the US, with strict controls on employee access. TikTok's biggest investors come from the US.
"We are committed to protecting our users' privacy and safety as we continue working to bring joy to families and meaningful careers to those who create on our platform."
