TikTok finalizes deal for new US joint venture
TikTok’s Chinese owner, ByteDance, said on Thursday that it has finalized a deal to establish a majority American-owned joint venture designed to secure U.S. data, in a move aimed at avoiding a nationwide ban on the short-video app used by more than 200 million Americans.
The agreement marks a milestone for the social media company after years of political and legal battles that began in August 2020, News.Az reports, citing Reuters.
Trump later chose not to enforce a law passed in April 2024 that required ByteDance to divest its U.S. assets by the following January or face a ban, a measure that was subsequently upheld by the Supreme Court.
ByteDance said the new entity, TikTok USDS Joint Venture LLC, will be responsible for securing U.S. user data, applications and algorithms through enhanced data-privacy and cybersecurity measures, though it disclosed few details about the divestiture itself.
Trump praised the agreement 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 also thanked Chinese President Xi Jinping “for working with us and, ultimately, approving the Deal,” adding that Xi “could have gone the other way, but didn’t, and is appreciated for his decision.”
Under the terms of the deal, American and global investors will hold 80.1% of the joint venture, while ByteDance will retain a 19.9% stake.
The venture’s three managing investors — cloud-computing company Oracle, private equity firm Silver Lake, and Abu Dhabi-based investment firm MGX — will each hold 15%.
A White House official told Reuters that both the U.S. and Chinese governments had signed off on the agreement. The Chinese Embassy in Washington did not immediately respond to requests for comment.
Trump said last year that the deal met the divestiture requirements set out in the 2024 law. In September, the White House said the new venture would operate TikTok’s U.S. app. However, interested parties have yet to disclose certain elements of the agreement, including the precise business relationships between the joint venture and ByteDance.
Trump, who has more than 16 million followers on his personal TikTok account, has credited the app with helping him win reelection. He received a document from TikTok on December 22 highlighting his popularity on the platform, according to a photograph published this month by the New York Times. The White House also launched an official TikTok account in August.
TikTok said investors in the venture include the Dell Family Office — the investment firm of Dell Technologies founder Michael Dell — as well as Vastmere Strategic Investments, Alpha Wave Partners, Revolution, Merritt Way, Via Nova, Virgo LI and NJJ Capital.
Former TikTok USDS executives Adam Presser and Will Farrell have been appointed chief executive officer and chief security officer, respectively.
TikTok CEO Shou Chew has also been named to the venture’s board, while continuing to lead TikTok’s global business operations and strategy.
According to TikTok, the joint venture will retrain, test and update the platform’s content-recommendation algorithm using U.S. user data, with the algorithm secured within Oracle’s U.S. cloud infrastructure.
By Nijat Babayev
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