TikTok strikes deal to hand US operations to American investors
What's the story
TikTok has struck a deal to hand over a major chunk of its US operations to a group of American investors. The move puts an end to years of conflict as the federal government pushed for such an arrangement. The new partnership is described as a "new TikTok US joint venture" in an internal memo from ByteDance CEO Shou Chew, which was seen by TechCrunch.
Investor takeover
American investors to gain significant control
The new partnership will see major American investors take over a large chunk of the US-based business. The investor group comprises cloud giant Oracle, tech-focused private equity firm Silverlake, and Abu Dhabi-based AI investment firm MGX. Together, they will own 45% of the US operation while ByteDance will hold nearly 20%, as per the memo. The newly formed entity from this partnership is called "TikTok USDS Joint Venture LLC."
Operational control
New entity to oversee app operations
The newly formed entity will oversee various aspects of the app, including data protection, algorithm security, content moderation, and software assurance. A trusted security partner will audit and validate compliance with the agreed-upon National Security Terms. Oracle has been chosen as this trusted security partner upon completion of the transaction. The deal is set to close on January 22, 2026.
Regulatory compliance
Deal aligns with Trump's executive order
The deal closely resembles an executive order signed by former President Trump in September, which also approved the sale of TikTok's US operations to an American investor group. CNBC had previously reported that Oracle, Silverlake, and MGX would be the lead investors in this deal. Until now, ByteDance had not confirmed such a deal but said it would comply with US law to keep TikTok running for American users.