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ByteDance, TikTok's Chinese parent company, has finalized binding agreements with US and international investors to establish a new operational structure for its American business, TikTok's boss revealed to employees on Thursday. This joint venture, designed to manage TikTok's US operations, will be 50% owned by a consortium of investors, including Oracle, Silver Lake, and Emirati firm MGX, according to CEO Shou Zi Chew's memo.
The deal, which is set to close on 22 January, would end years of efforts by Washington to force ByteDance to sell its US operations over national security concerns.
It is in line with a deal unveiled in September, when US President Donald Trump delayed the enforcement of a law that would ban the app unless it was sold.
In the memo, TikTok said the deal will enable "over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community".
Under the agreement, ByteDance will retain 19.9% of the business, while Oracle, Silver Lake and Abu Dhabi-based MGX will hold 15% each.
Another 30.1% will be held by affiliates of existing ByteDance investors, according to the memo.
The White House previously said that Oracle, which was co-founded by Trump supporter Larry Ellison, will license TikTok's recommendation algorithm as part of the deal. The deal comes after a series of delays.
In April 2024, during President Joe Biden's administration, the US Congress passed a law to ban the app over national security concerns, unless it was sold. The law was set to go into effect on 20 January 2025 but was pushed back multiple times by Trump, while his administration worked out a deal to transfer ownership.
Trump said in September that he had spoken on the phone to China's President Xi Jinping, who he said had given the deal the go ahead.
The platform's future remained unclear after the leaders met face to face in October. The app's fate was clouded by ongoing tensions between the two nations on trade and other matters.
The deal drew criticism from Senate Democrat Ron Wyden of Oregon, who said it wouldn't do "a thing to protect the privacy of American users".
Under the terms, TikTok's recommendation algorithm is set to be retrained on American user data to ensure feeds are free from outside manipulation.
