TikTok and its Chinese owner ByteDance have officially established a venture to transfer parts of its US business to a consortium of mostly US investors, effectively securing the platform’s future for its 170 million American users.
The company made the announcement on Thursday, hours ahead of a Friday shutdown deadline.
The deal – first outlined by TikTok chief executive Chew Shou Zi in an internal memo last month – was set to close this week, though it had not previously received the formal blessing of both countries.
In a social media post on Thursday, US President Donald Trump gave his blessing, saying he was “so happy to have helped in saving TikTok”.
“It will now be owned by a group of Great American Patriots and Investors, the Biggest in the World, and will be an important Voice,” he said. In the same post, Trump 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,” he continued.
In a statement on Thursday, the Chinese embassy in Washington said it had nothing to share on news reports that the deal had received official approval from Beijing. “China’s position on the TikTok issue has been consistent and clear. I have nothing new to share at the moment,” said embassy spokesperson Liu Pengyu.
The White House did not immediately respond to a request for comment.
Chew told employees in December that TikTok and ByteDance signed binding agreements to create a US joint venture – majority-owned by American investors including Oracle, Silver Lake and MGX – but that there was “more work to be done”.
Upon closing, the US joint venture will operate as an independent entity that will control algorithm security, data protection and content moderation, he said.
According to the Thursday announcement, the entity’s name is TikTok USDS Joint Venture and it will be governed by a seven-member majority-American board of directors.
Chew is part of the board, along with Oracle executive vice-president Kenneth Glueck, Silver Lake co-CEO Egon Durban, MGX chief strategy and safety officer David Scott and Timothy Dattels, senior adviser of TPG Global.
Mark Dooley, managing director at Susquehanna International Group, and DXC Technology CEO Raul Fernandez, make up the remainder of the board appointments.
TikTok’s statements match the White House announcement in September, which valued TikTok’s US operations at about US$14 billion.
Under the arrangement confirmed on Thursday, Oracle, Silver Lake and MGX will each hold 15 per cent as managing investors, while ByteDance will retain 19.9 per cent.
Other members of the consortium include the Dell Family Office – the investment firm of Michael Dell, chairman and CEO of Dell Technologies – along with Vastmere Strategic Investments, an affiliate of Susquehanna International Group.
Also part of the consortium are Merritt Way, controlled and managed by partners of Dragoneer, and NJJ Capital, the family office of Xavier Niel, a French entrepreneur and pioneer in telecommunications.
Bloomberg has previously reported that ByteDance would retain around 50 per cent of the profit from the new entity.
ByteDance’s involvement has long been a sticking point in negotiations, and has led critics, including members of Trump’s own Republican Party, to argue that the arrangement the White House negotiated might not pass legal muster. The 2024 law signed by former US president Joe Biden said that TikTok US and ByteDance should have no “operational” relationship.
That law allowed for a one-time 90-day extension of the original January 2025 shutdown deadline if “significant” progress towards a sale was evident. Trump has since extended the deadline five times, most recently to January 23, 2026.
ByteDance’s content algorithms are considered the secret sauce to TikTok’s successful business. Under the version of the deal recently outlined by the White House, ByteDance is expected to license its recommendation technology to the new US entity, which will use the existing algorithm to retrain a new system on US data that is secured by Oracle.
Oracle’s data security role has also raised concerns. The arrangement mirrors an earlier TikTok-Oracle collaboration called Project Texas that was unsuccessfully proposed years ago to the US government as a way to solve concerns about TikTok’s Chinese ownership.
The law mandating the sale, passed as part of a bipartisan foreign aid package, reflects Washington’s concern that TikTok’s ownership makes it beholden to the Chinese government and that Beijing could use the app to spy on Americans or conduct influence operations.
Under Chinese export controls, some technologies used by TikTok, including its recommendation algorithm, require Beijing’s approval for export. The restriction was implemented by Beijing in 2020, killing a deal that had been under negotiation involving ByteDance, Oracle and Walmart during the first Trump administration. -- SOUTH CHINA MORNING POST
