US EditionTikTok signs deal to sell US unit to American investor-led venture
TikTok's U.S. operations will be controlled by a new joint venture led by Oracle, Silver Lake, and MGX, preserving access for 170 million American users and addressing national security concerns.
- TikTok CEO Shou Zi Chew said in a memo that ByteDance Ltd. and TikTok Inc. signed binding agreements with three managing investors to form TikTok USDS Joint Venture LLC, effective January 22, 2025.
- Since 2020, pressure from lawmakers and courts and a 2024 bipartisan law pushed ByteDance Ltd. to divest U.S. TikTok, with legal rulings surviving U.S. Supreme Court appeals.
- The new venture is structured so that the U.S. entity will handle data protection, algorithm security, and moderation, with Oracle Corporation overseeing data protection and content policy approval.
- Consequently, over 170 million American users of TikTok can continue using the platform, and Oracle shares jumped more than 6% to $189.10 after-hours on the news.
- Meanwhile, the JV will retrain the recommendation algorithm on U.S. data `to ensure the content feed is free from outside manipulation`, while ByteDance Ltd., retaining minority stake, and Larry Ellison, Oracle co-founder and Trump confidante, add political scrutiny.
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