TikTok Reaches Deal with American Investors to Cede U.S. Operations
In a significant development, TikTok has finalized a deal to transfer a substantial portion of its U.S. operation to a group of American investors, bringing an end to a prolonged conflict with the federal government over this issue.
The new collaboration has been characterized as a “new TikTok U.S. joint venture” in an internal memo from ByteDance CEO Shou Chew, as reported by JS.
Under this arrangement, prominent American investors will assume significant control of the U.S.-based business. The consortium of investors includes Oracle, Silverlake, and MGX, with a combined ownership stake of 45% in the U.S. operation, while ByteDance will retain close to 20%, according to the memo. The newly formed entity resulting from this partnership will be known as “TikTok USDS Joint Venture LLC.”
This newly formed entity will be tasked with overseeing various aspects of the app, such as data protection, algorithm security, content moderation, and software assurance. The memo outlines that a trusted security partner will be responsible for auditing and ensuring compliance with National Security Terms, with Oracle identified as the designated security partner upon the completion of the transaction.
The deal is set to be finalized by January 22, 2026, as initially reported by Axios.
The terms of the agreement closely mirror those outlined in an executive order signed by former President Trump in September, which authorized the sale of TikTok’s U.S. operations to an American investor group. Previous reports had hinted at Oracle, Silverlake, and MGX’s involvement in the deal, with ByteDance refraining from disclosing specifics until now, except to confirm its commitment to complying with U.S. regulations to ensure continued access for American users.
The U.S. government’s persistent efforts to separate TikTok’s U.S. business from its Chinese parent company have been driven by national security concerns.
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