Talks of a stock sale to China’s TikTok rival Xiaohongshu are worth $20 billion, Bloomberg News reported.

(Reuters) – China’s Xiaohongshu backers are looking to sell part of their stake in the TikTok rival to the likes of Tencent in a deal that could value it at least $20 billion, Bloomberg News reported on Thursday.

GGV Capital, GSR Ventures and Tiantu Capital, key shareholders of the social media platform, have expressed interest in existing backers Hongshan Capital Group and Hillhouse Investments, Bloomberg News said, citing people familiar with the matter.

Another existing shareholder, Tencent, is considering buying more shares, the report added.

The report comes as Tik Tok prepares to shut down its US operations as a federal ban comes into effect, denying last-minute relief.

Xiaohongshu, whose name translates to “little red book,” is similar to Meta’s Instagram in that it allows users to create photos, videos, and articles that document their lives.

The company, a privately held company with more than 300 million users, is reported to have a valuation of $17 billion after its latest funding round in July 2024.

Tencent, TikTok and its parent ByteDance, and Xiaohongshu CEO Charlwyn Mao did not immediately respond to requests for comment.

(Reporting by Aditya Govind Rao in Bengaluru; Editing by Margank Dhaniwala)