TikTok’s Chinese parent company, ByteDance, has signed binding agreements to transfer control of the app’s U.S. operations to a group of investors, including Oracle, in a move aimed at averting a potential ban in the United States.
The deal marks a significant step for the short-form video platform, which is used by more than 170 million Americans, following years of regulatory and political scrutiny over national security concerns. Those concerns first escalated in August 2020, when then-President Donald Trump sought to ban the app unless its U.S. operations were divested.
Financial terms were not disclosed in an internal TikTok U.S. memo seen by Reuters. However, Vice President JD Vance said in September that the new U.S. entity would be valued at around $14 billion, a figure below earlier analyst estimates.
Under the agreement, a new entity, TikTok USDS Joint Venture LLC, will be majority-owned by American and global investors, including Oracle, Silver Lake, and Abu Dhabi-based MGX, which together will hold an 80.1% stake. ByteDance will retain a 19.9% ownership interest. Oracle shares rose nearly 6% in premarket trading on Friday.
The White House said previously that the joint venture would operate TikTok’s U.S. app, though questions remain about ByteDance’s ongoing role. TikTok CEO Shou Zi Chew told employees that the new entity would operate independently, with authority over U.S. data protection, algorithm security, content moderation, and software assurance.
