A new U.S.-controlled company is taking over TikTok’s American business after Donald Trump signed an executive order Thursday approving the deal.
The takeover, led by Oracle, gives a group of American and international investors a 45% stake in the video app. ByteDance, the China-based owner of TikTok, will hold less than 20%, avoiding a full ban under a U.S. national security law that forces foreign tech companies to divest their U.S. holdings or face shutdown.
According to Vice President JD Vance, the agreement values TikTok at $14 billion. The joint venture must still be approved by China, but Trump claims he already got the green light from Chinese President Xi Jinping. No ByteDance reps were present during the signing.
ByteDance has also not publicly confirmed the deal, and there’s been no mention of a final purchase price. There’s also no sign that China has updated its legal restrictions, which would be required to finalize this transaction.
Oracle handles security and tech roles
As part of the arrangement, Oracle will manage all security operations for TikTok’s U.S. arm and will continue providing cloud infrastructure for the platform. Trump said Oracle co-founder Larry Ellison is part of the ownership team and stressed the group is “playing a very big part.” Trump told reporters, “It’s owned by Americans, and very sophisticated Americans. This is going to be American operated all the way.”
Joining Oracle in the investor group are Silver Lake and Abu Dhabi’s MGX investment fund, which together will own the largest share, 45%, of the new company. Another 35% will be held by a mix of ByteDance’s existing investors and new stakeholders, based on reporting from CNBC’s David Faber.
Major U.S. investors in ByteDance—General Atlantic, Susquehanna, and Sequoia—are expected to throw in equity toward the new entity. That said, ByteDance itself will not be running the show. It’s getting pushed far enough away to meet U.S. demands without completely walking away. Last month, ByteDance was valued at a massive $330 billion, and previous estimates pegged TikTok’s U.S. operations at anywhere from $30 billion to $35 billion.
No government ownership, but more U.S. names enter the mix
The U.S. government is not taking a stake in the business. There won’t be any “golden share” or special power given to the federal government over TikTok’s American entity. That was confirmed earlier this week by CNBC, which said there’s no federal equity stake involved at all.
Meanwhile, Trump said Rupert Murdoch and Lachlan Murdoch might also be backing the TikTok deal. He added that Michael Dell, CEO of Dell Technologies, could be involved too. So the list of American billionaires tied to this thing is getting longer.
Just last week, Trump signed an executive order extending the deadline for ByteDance to exit the U.S. business. That order blocks the Department of Justice from punishing tech platforms like Apple, Google, or internet providers for working with TikTok while the transition is underway.
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Source: https://www.cryptopolitan.com/tiktok-under-trump-signed-executive-order/
