TikTok agrees to US joint venture to keep operating
TikTok has reached a joint venture agreement with major investors to continue its operations in the United States, aiming to avoid a potential ban due to its Chinese ownership. The deal, announced by CEO Shou Chew in an internal memo, brings in Oracle, Silver Lake, and MGX as key stakeholders. The arrangement comes after US lawmakers raised concerns about data security and foreign influence. The agreement is expected to close by January 22, 2025, but further steps remain before it is finalized.
What we know
- TikTok and parent company ByteDance have agreed to form a new US-based entity with Oracle, Silver Lake, and MGX as major investors.
- The joint venture will oversee US data protection, algorithm security, and content moderation for American users.
- Oracle, Silver Lake, and MGX will each hold 15%, while ByteDance will retain just under 20% ownership, complying with US legal limits.
- The deal responds to a law passed under President Joe Biden requiring ByteDance to divest TikTok’s US operations or face a ban.
- The agreement must be completed by January 22, 2025, and still needs Chinese government approval.
