TikTok Completes U.S. Joint Venture Deal to Avoid Ban

TLDR

• TikTok formed a U.S. joint venture called TikTok USDS to keep operating in America under new leadership
• Adam Presser, TikTok’s head of operations, becomes CEO of the new venture while Shou Chew remains a director
• ByteDance retains 19.9% ownership while Oracle, Silver Lake, and MGX hold 50% as managing investors
• The deal resolves a five-year dispute over national security concerns and avoids a ban that Congress passed in 2024
• TikTok’s algorithm will now be hosted in Oracle’s U.S. data centers and trained on American user data

TikTok announced Thursday it has formed a new U.S. joint venture that allows the video app to continue operating in America. The deal ends years of legal battles over national security concerns related to its Chinese ownership.

The new entity is called TikTok USDS Joint Venture. Adam Presser will serve as CEO of the U.S. operation.

Presser previously worked as TikTok’s head of operations and trust and safety for almost four years. Before joining TikTok, he held a senior position at Warner Bros.

TikTok CEO Shou Chew will remain a director of the new venture. The company says the joint venture will operate as an independent entity.

The ownership structure splits control between new American investors and ByteDance. Oracle, Silver Lake, and MGX will hold 50% as managing investors.

ByteDance retains 19.9% of the new venture. Other investors include Michael Dell’s firm Vastmere Strategic Investments, Alpha Wave Partners, Revolution, and General Atlantic affiliate Via Nova.

New Leadership and Security Measures

The joint venture will have a seven-member board of directors with an American majority. Board members include TPG Global’s Timothy Dattels, Susquehanna International Group’s Mark Dooley, and Silver Lake co-CEO Egon Durban.

DXC Technology CEO Raul Fernandez, Oracle’s Kenneth Glueck, and MGX’s David Scott also join the board. Shou Chew rounds out the seven-member panel.

TikTok says the new structure includes data protections, algorithm security, and content moderation safeguards. The company’s recommendation algorithm will now be hosted in Oracle’s American data centers.

The algorithm will be retrained and updated using U.S. user data. TikTok says this setup protects national security while maintaining the app’s global features.

The deal also keeps related apps like CapCut and Lemon8 operational in America. U.S. creators will still be able to reach global audiences through the platform.

Political Approval and Timeline

President Donald Trump announced support for the deal on Truth Social Thursday. He thanked Chinese President Xi Jinping for approving the agreement.

The deal resolves issues stemming from a national security law signed by former President Joe Biden. That law required ByteDance to sell its U.S. operations or face a ban.

Trump signed executive orders that prevented the ban from taking effect. Those orders gave TikTok time to find buyers for its American business.

Vice President JD Vance said in September there was resistance from the Chinese government. At that time, officials valued TikTok’s U.S. business at $14 billion.

Semafor reported earlier Thursday that both U.S. and Chinese governments signed off on the sale. The deal was expected to close this week.

TikTok revealed the name of its U.S. entity to employees in December. CEO Shou Chew told staff the company had signed an agreement to form the joint venture.

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