TikTok signs deal to sell US unit to American investor-led venture
In September, Reuters reported, citing sources, that ByteDance would maintain ownership of TikTok's U.S. business operations but would cede control of the app's data, content and algorithm to the joint venture.
The joint venture would serve as the backend operations to the U.S. company and handle U.S. user data and the algorithm, sources said at the time, adding a separate division that will continue to be wholly owned by ByteDance would control the revenue-generating business operations such as e-commerce and advertising.
Those arrangements formed the deal contour announced on Thursday, two sources with knowledge of the matter told Reuters on Friday.
The ByteDance-controlled TikTok U.S. entity would be the revenue generating one, while the new joint venture will receive a portion of the revenue for its technology and data services, the sources said.
The sources declined to be named due to the sensitivity of the matter. The White House, ByteDance and TikTok US did not immediately respond to Reuters requests for comment on the deal details.
State-run China Daily earlier on Friday reported on the revenue arrangement between the two entities.
The deal, set to close 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.
The agreement over 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.
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," TikTok said in the memo to employees.
'BILLIONAIRE TAKEOVER'
Trump credited TikTok with helping him win reelection last year and has more than 15 million followers on his personal TikTok account. The White House also launched an official TikTok account in August.
Democratic Senator Elizabeth Warren said there were many unanswered questions over the deal.
"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.
Trump has a close relationship with billionaire and Oracle CEO Larry Ellison and his family. Paramount Skydance is trying to acquire Warner Bros Discovery in a hostile takeover bid with the financial backing of the Ellison family.
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. It was unclear if Dell and Murdoch participated in the final deal.
(Reporting by David Shepardson in Washington, Hong Kong newsroom, and Kritika Lamba in Bengaluru; additional reporting by Eduardo Baptista in Beijing; Editing by Matthew Lewis, Jamie Freed and Susan Fenton)
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