TikTok seals deal for new US joint venture to avoid American ban

TikTok's Chinese owner, ByteDance, on Thursday said it has finalized a deal to establish a majority American-owned joint venture that will secure U.S. data, to avoid a U.S. ban on the short video app used by over 200 million Americans.

The deal is a milestone for the social media firm after years of battles that began in August 2020 when President Donald Trump tried to ban the app over national security concerns.

Trump later opted not to enforce a law passed in April 2024 requiring ByteDance to sell its U.S. assets by the following January or face a ban - a measure upheld by the Supreme Court.

ByteDance said TikTok USDS Joint Venture LLC will secure U.S. user data, apps and algorithms through data privacy and cybersecurity measures. It disclosed few details about the divestiture.

Trump praised the deal in a social media post saying TikTok "will now be owned by a group of Great American Patriots and Investors, the Biggest in the World."

He thanked Chinese President Xi Jinping "for working with us and, ultimately, approving the Deal. He could have gone the other way, but didn’t, and is appreciated for his decision."

The agreement provides for American and global investors to hold 80.1% of the venture while ByteDance will own 19.9%.

TikTok USDS JV's three managing investors - cloud computing giant Oracle, private equity group Silver Lake (SILAK.UL) and Abu Dhabi-based investment firm MGX - will each hold 15%.

A White House official told Reuters that the U.S. and Chinese governments had signed off on the deal. The Chinese Embassy in Washington did not immediately comment.

Reuters