TikTok Deal Gives U.S. Investors Majority Control, Avoids Ban

TikTok’s Chinese parent company, ByteDance, said Thursday it has completed a deal to create a majority American-owned joint venture. The move aims to protect U.S. user data and prevent a nationwide ban of the app, which more than 200 million Americans use.

The agreement marks a major turning point after years of political and legal pressure on TikTok over national security concerns.

Long-Running Dispute Dates Back to 2020

The conflict began in August 2020, when then-President Donald Trump attempted to ban TikTok. He cited concerns that U.S. user data could be accessed by China.

In April 2024, Congress passed a law requiring ByteDance to sell TikTok’s U.S. assets or face a ban by January 2025. The Supreme Court later upheld the law. Trump ultimately chose not to enforce it after negotiations progressed.

New Joint Venture Structure and Ownership

ByteDance said the new entity, called TikTok USDS Joint Venture LLC, will protect U.S. user data, apps, and algorithms through strict privacy and cybersecurity safeguards. The company shared limited details about the divestiture.

Under the deal:

• American and global investors will own 80.1% of the venture
• ByteDance will retain a 19.9% stake

The three main managing investors — Oracle, Silver Lake, and Abu Dhabi-based MGX — will each hold 15% ownership.

U.S. and China Approve the Agreement

A White House official confirmed that both the U.S. and Chinese governments approved the deal. China’s embassy in Washington declined to comment.

Trump praised the agreement on social media, calling the investors “Great American Patriots.” He also thanked Chinese President Xi Jinping for approving the arrangement.

TikTok’s U.S. Operations and Leadership Changes

The White House said the new venture will operate TikTok’s U.S. app. However, key business details — including ByteDance’s ongoing relationship with the venture — remain undisclosed.

Several executives were appointed to lead the venture:

• Adam Presser as Chief Executive Officer
• Will Farrell as Chief Security Officer

TikTok CEO Shou Chew will sit on the venture’s board while continuing to oversee TikTok’s global strategy.

Data Security and Algorithm Control

TikTok said the venture will retrain and manage its recommendation algorithm using U.S. user data. Oracle will store and secure the algorithm in its U.S.-based cloud infrastructure.

Reuters previously reported that ByteDance would keep ownership of TikTok’s U.S. business but would hand over control of data, content moderation, and algorithms to the joint venture.

Revenue and Business Operations Split

Sources said the new venture will manage backend operations, including user data and algorithm services. A separate ByteDance-owned unit will continue handling revenue-generating activities, such as advertising and e-commerce.

The joint venture will receive a share of revenue in exchange for its technology and data services.

Trump’s Personal Ties to TikTok

Trump has more than 16 million followers on TikTok and has credited the platform with helping him win reelection. TikTok reportedly shared internal data highlighting his popularity on the app. The White House also launched its official TikTok account in August.