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Key Takeaways
- TikTok said Thursday it has finalized a deal bringing its U.S. operations under a joint venture majority owned by American investors.
- The deal ends a yearslong push by the U.S. government for American control of the formerly Chinese-owned platform on national security grounds.
TikTok has finally ironed out a deal giving American investors a majority stake in its U.S. business. One of them is a big name in tech.
The social media platform on Thursday said it has finished the details of an agreement bringing the previously Chinese-owned app’s U.S. operations under a joint venture controlled by a group of American investors. Larry Ellison’s Oracle (ORCL) is one of the largest investors, along with private equity firm Silver Lake and Abu Dhabi-based MGX, each holding 15%. ByteDance is retaining a 19.9% stake.
Other investors include the family office of Dell (DELL) founder Michael Dell and Revolution, Vice President J.D. Vance’s former employer.
Why This Is Signficiant
The deal ends a yearslong push by the U.S. government for China’s ByteDance to cede control of the social media app on national security concerns.
TikTok veteran Adam Presser will serve as CEO of the U.S.-based joint venture, with TikTok CEO Shou Chew and representatives from several investors sitting on its board.
The agreement, brokered by President Donald Trump, comes ahead of this week’s deadline for TikTok to strike a deal or face a ban of the app in the U.S., after a series of extensions by executive order. Trump on social media Thursday night thanked people within his administration, but also Chinese President Xi Jinping, for working to make the deal happen.
TikTok said Thursday that the joint venture will “operate under defined safeguards that protect national security through comprehensive data protections, algorithm security, content moderation, and software assurances for U.S. users,” with its content recommendation algorithm stored with Oracle.
Shares of Oracle were little changed Friday. Read Investopedia’s full coverage of today’s trading here.
