TikTok Owner Agrees to Sell U.S. Operations

ByteDance, the parent company of TikTok, has made a significant decision regarding its U.S. business operations. The company has finalized agreements with several investors to sell the majority of its American operations. This move follows ongoing scrutiny by U.S. authorities about national security risks posed by the app.

TikTok Ownership Transition

Chief Executive Shou Zi Chew informed employees that the sale will involve major investors such as Oracle and Silver Lake, along with the Emirati firm MGX. This consortium will own 50% of a new joint venture.

Key Details of the Agreement

• Sale Completion Date: January 22
• ByteDance Retention: 19.9% of the new business
• Investor Shares:
  • Oracle – 15%
  • Silver Lake – 15%
  • MGX – 15%
  • Affiliates of existing ByteDance investors – 30.1%

This agreement follows previous pressure from Washington to compel ByteDance to divest its U.S. operations. In April 2024, Congress passed legislation to ban TikTok over national security issues unless it was sold. This law was scheduled to take effect on January 20, 2025, but experienced multiple delays.

Historical Context

Former President Donald Trump initiated the push for TikTok’s sale, initially delaying enforcement of the ban to negotiate a resolution. In September, Trump mentioned talks with China’s President Xi Jinping, who reportedly approved the sale.

The deal aims to ensure that more than 170 million TikTok users in the U.S. can continue using the platform. According to the memo, the transition will enhance their experience within a global community.

Oracle, known for its relationship with Trump supporter Larry Ellison, has been assigned to license TikTok’s recommendation algorithm as part of this agreement. Although the White House did not comment directly, they redirected inquiries to TikTok.

This strategic sale marks a significant chapter in TikTok’s operations, balancing business interests with regulatory compliance in the U.S.