Key Points
- TikTok’s owner, ByteDance, has signed a deal to sell a majority of its U.S. assets.
- The sale is to a new joint venture that Oracle, Silver Lake, and MGX will manage.
- The deal is designed to avoid a U.S. government ban on the popular app. ByteDance will retain a 19.9% minority stake in the new U.S. company.
- The sale is expected to close on January 22, resolving years of political uncertainty.
TikTok’s Chinese owner, ByteDance, has signed binding agreements to sell a majority of the app’s U.S. assets to a group of American and global investors. The move is a major step toward ending years of political uncertainty and avoiding a U.S. government ban on the popular video-sharing platform.
TikTok CEO Shou Zi Chew told employees about the deal on Thursday. The new agreement is in line with a plan that was first unveiled in September.
At that time, President Donald Trump delayed a potential ban to give the parties time to finalize the sale, declaring that the proposed deal would meet U.S. national security requirements.
Under the terms of the deal, a new U.S.-based company, TikTok USDS Joint Venture, will be formed. ByteDance will sell off just over 80% of its U.S. business to this new entity. Three major investors—Oracle, Silver Lake, and Abu Dhabi-based MGX—will be the managing partners of the new venture. Together, they will own 45% of the company.
The rest of the new entity will be owned by a mix of new investors, some of ByteDance’s existing investors, and ByteDance itself, which will retain a 19.9% minority stake.
The deal is set to close on January 22. It aims to address long-standing U.S. government concerns that the Chinese government could access American users’ data. The new structure is designed to place TikTok’s U.S. operations firmly under American control.
