Chinese owner of Grindr says no deal with CFIUS yet

Grindr raked in RMB 572 million in 2018.

August 20, 2018 - Munich, Bavaria, Germany - The logo of the dating app Grindr is seen on a mobile screen and a laptop screen. Grindr is a dating app for gay, bi, pan and curious men. Several Millions use Dating Apps every day

Chinese gaming company Kunlun said it has not reached any deal with the Committee on Foreign Investment in the United States (CFIUS) regarding its stake in gay dating app Grindr, despite previous reports of the mounting pressure on the Beijing-based company.

In a statement issued yesterday evening, Kunlun confirmed it was communicating with CFIUS regarding its control of Grindr but “has yet to reach any deal” with the governmental body. Kunlun bought a 61.53% stake in Grindr for USD 93 million in 2016 and completed the acquisition of the remaining shares for USD 152 million in 2018.

Grindr raked in RMB 572 million (USD 85.3 million ) in 2018.

Kunlun’s sole ownership of Grindr, one of the biggest gay dating apps with millions of users in the US, has raised a red flag as personal information collected by the app includes users’ sexual orientations, locations, and messages.

A security flaw discovered last year showed that third-party companies were able to gain access to sensitive private information such as users’ HIV status. Grindr’s security issues first came into the public eye in 2014 when cybersecurity researchers found out that the app revealed the locations of its users.

Last week, Reuters reported that Kunlun, which was planning an IPO for Grindr, was asked by CFIUS to spin off the app due to national security concerns. Investment bank Cowen was hired to handle the sale process.