China's ByteDance signs deal to form joint venture to operate TikTok US app
The deal, set on January 22, would end years of efforts to force ByteDance to divest its U.S. business over national security concerns. Representative John Moolenaar, a Republican who chairs the House Select Committee on China said previously he would host the leadership of the new TikTok entity at a hearing in 2026.
Trump has credited TikTok, which has 170 million U.S. users, with helping him win reelection last year. Trump has more than 15 million followers on his personal TikTok account. The White House also launched an official TikTok account in August.
'BILLIONAIRE TAKEOVER'
Democratic Senator Elizabeth Warren said there were many unanswered questions.
"Trump wants to hand over even more control of what you watch to his billionaire buddies. Americans deserve to know if the president struck another backdoor deal for this billionaire takeover of TikTok," she said on X.
The U.S. joint venture will be 50% held by a consortium of new investors, including Oracle, Silver Lake and MGX with 15% each; 30.1% held by affiliates of certain existing investors of ByteDance; and 19.9% will be retained by ByteDance, the memo said.
Trump said in September that Michael Dell, the founder, chairman and CEO of Dell Technologies; Rupert Murdoch, the chairman emeritus of Fox News owner Fox Corp and newspaper publisher News Corp, and "probably four or five absolutely world-class investors" would be part of the deal.
ByteDance did not immediately respond to a request for comment.
DATA PROTECTION
The 2024 law required TikTok to stop operating by January 19 unless ByteDance had completed a divestiture of the app's U.S. assets. Trump began his second term as president on January 20 and opted not to enforce it.
Trump's order issued in September said the algorithm will be retrained and monitored by the U.S. company's security partners, and operation of the algorithm will be under the control of the new joint venture. It gave them until late January to complete the deal.
The agreement on TikTok’s U.S. operations includes the appointment by ByteDance of one of seven board members for the new entity, with Americans holding the majority of other seats. TikTok said Thursday the U.S. joint venture will be "responsible for U.S. data protection, algorithm security, content moderation, and software assurance."
Oracle will serve as the "trusted security partner" responsible for auditing and validating compliance including "safeguarding sensitive U.S. user data, which will be stored in a trusted and secure cloud environment in the United States run by Oracle."
Craig A. Huber, an analyst at Huber Research Partners, LLC, said he expected the deal to get waved through the approval process.
"At this stage, I see no regulatory issues, particularly given the federal government and President Trump were very involved in putting the whole sale together from the beginning," he said.
(Reporting by David Shepardson in Washington and Kritika Lamba in Bengaluru; Editing by Alan Barona, Matthew Lewis and Stephen Coates)
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