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TikTok’s Chinese owner, ByteDance, on Thursday said it had finalized a deal to establish a majority American-owned joint venture that will secure U.S. data, to avoid a U.S. ban on the short video app used by over 200 million Americans.
The deal is a milestone for the social media firm after years of battles that began in August 2020 when President Donald Trump tried to ban the app over national security concerns, according to Reuters.
Trump later opted not to enforce a law passed in April 2024 requiring ByteDance to sell its U.S. assets by the following January or face a ban – a measure upheld by the Supreme Court.
ByteDance said TikTok USDS Joint Venture LLC will secure U.S. user data, apps and algorithms through data privacy and cybersecurity measures. It disclosed few details about the divestiture.
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Trump praised the deal in a social media post saying TikTok “will now be owned by a group of Great American Patriots and Investors, the Biggest in the World.”
He thanked Chinese President Xi Jinping “for working with us and, ultimately, approving the Deal. He could have gone the other way, but didn’t, and is appreciated for his decision.”
The agreement provides for American and global investors to hold 80.1% of the venture while ByteDance will own 19.9%.
TikTok USDS JV’s three managing investors – cloud computing giant Oracle (ORCL.N), private equity group Silver Lake (SILAK.UL) and Abu Dhabi-based investment firm MGX – will each hold 15%.
Interested parties have yet to disclose elements of the deal such as the business relationships between the venture and ByteDance.
TikTok said investors in the venture include Dell Family Office – investment firm of Dell Technologies (DELL.N) founder Michael Dell – plus Vastmere Strategic Investments, Alpha Wave Partners, Revolution, Merritt Way, Via Nova, Virgo LI and NJJ Capital.
Former TikTok USDS figures Adam Presser and Will Farrell have been appointed CEO and chief security officer respectively.
TikTok CEO Shou Chew was also named to the venture’s board; he leads TikTok’s global businesses and strategy.
The venture will retrain, test and update TikTok’s content recommendation algorithm on U.S. user data and the algorithm will be secured in Oracle’s U.S. cloud, TikTok said.
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