TikTok Finalizes Agreement to Transfer U.S. Operations to Domestic Stakeholders

TikTok has officially reached an agreement to transition its U.S. business activities to a group composed of American investors, as confirmed by a reliable insider.

This development was initially covered by Axios.

In compliance with legislative requirements, ByteDance, TikTok’s parent company headquartered in China, is compelled to either divest its American segment or face exclusion from app stores and hosting platforms within the U.S. While the law imposes a deadline of January 2025, this has been postponed by former President Trump up to January 23, 2026.

In a move enacted through an executive order in September, Mr. Trump facilitated a restructuring plan for TikTok to operate in the U.S. with American financial backing.

As per a senior advisor from the White House in September, the agreement stipulates that ByteDance’s algorithm, vital to TikTok’s content delivery, will be modified and re-tuned specifically to leverage information from U.S. users. Oracle, a cloud technology provider, will ensure comprehensive security by safeguarding user data in the U.S. and auditing the app’s software to confirm secure and accurate functionality.

A newly formed “joint venture” will be directed from the U.S., predominantly owned and governed by American interests, with U.S. citizens constituting the majority on the board, as outlined by the White House in September. The executive order signed by Trump restricts ByteDance and its subsidiaries to under 20% ownership of the new entity, adhering to the foreign ownership limitations stipulated by last year’s legislation.

A group of American companies, with Oracle as a prominent participant, is expected to invest significantly in the revamped TikTok. It's noteworthy that Oracle’s co-founder, Larry Ellison, is part of the family that owns Paramount Skydance, which also controls CBS.

From the information provided by Axios, Oracle, along with Silver Lake and MGX from Abu Dhabi, is expected to collectively hold a 45% share in the U.S. branch. Meanwhile, nearly a third of the new entity will belong to the current investors of ByteDance.

The senior White House advisor reiterated a firm belief in September that the agreement, once finalized, will comply with all relevant legal frameworks, meeting statutory requirements universally.

Mr. Trump indicated that Chinese leader Xi Jinping expressed support for the deal in a telephonic discussion, according to comments made in September. “It has received approval from him,” Mr. Trump remarked.

China has released statements on the agreement but with less clarity.