ByteDance Permits Liquidation of Stock for US Employees without waiting for Listing

In accordance with people familiar with the matter, ByteDance, the Chinese owner of the short video app TikTok, will allow shares owned by US employees to vest without waiting for the company to list on the stock market, allowing them to cash out. The move is intended to appease employees who have been waiting for an initial public offering (IPO) in order to profit from the shares they were given as part of their compensation.

It is also an indication that ByteDance, whose valuation exceeds US$200 billion, is not in a rush to go public in the face of Beijing's increased scrutiny of China's technology behemoths.

ByteDance will now allow restricted shares held by US employees to vest as long as sufficient time has passed, the sources said. The company previously set a "liquidity event", such as an IPO or company sale, as a condition for the vesting to occur, the sources added. Once vested, the shares can be exchanged by the employees for cash in one of ByteDance's stock buyback programs.

The employees were informed of the changes on Tuesday, the sources said. A ByteDance spokesperson confirmed that the company has changed its share vesting rules but declined to comment on the details.