China’s ByteDance has signed binding agreements to transfer control of TikTok’s U.S. operations to a new joint venture led by American and global investors, a decisive step toward avoiding a U.S. ban and ending years of regulatory uncertainty.
Under the deal, investors including Oracle, private equity firm Silver Lake and Abu Dhabi-based MGX will hold an 80.1% stake in TikTok USDS Joint Venture LLC, while ByteDance will retain 19.9%. Financial terms were not disclosed, though U.S. Vice President JD Vance previously said the new entity would be valued at about $14 billion.
TikTok CEO Shou Zi Chew told employees the joint venture will operate as an independent entity, with authority over U.S. data protection, algorithm security, content moderation and software assurance. Oracle will serve as the “trusted security partner,” responsible for auditing compliance and safeguarding U.S. user data stored on its domestic cloud infrastructure.
Questions remain over ByteDance’s ongoing role, particularly around ownership and control of TikTok’s algorithm and revenue-generating businesses such as advertising and e-commerce. Sources said ByteDance will continue to run those commercial operations, while the joint venture manages U.S. user data and backend technology, receiving a portion of revenue for its services.
The deal, expected to close on January 22, follows years of national security scrutiny dating back to 2020 and would resolve the legal standoff that threatened TikTok’s access to more than 170 million U.S. users. Critics, including Senator Elizabeth Warren, have raised concerns about transparency and influence, calling for clearer answers on the structure and governance of the new entity.
