The highly anticipated TikTok deal has signed over the sale of its US entity to the joint American venture of three investors, Oracle, Silver Lake and MGX, according to an internal memo obtained by the Associated Press. The deal is reportedly still being finalised, and is expected to close on January 22, as per what CEO Shou Zi Chew said in the document.
Before closing, the deal requires approval from the Chinese government. CNN cited Trump suggesting that President Xi Jinping was for all for it, but a official confirmation from the Asian side is still awaited.
“We have signed agreements with investors regarding a new TikTok U.S. joint venture, enabling over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community,” the TikTok CEO said in the memo, as obtained by CNN. A personal privy with the details also confirmed the document’s accuracy to the US news outlet.
TikTok deal signed
A group of investors, including Oracle, Silver Lake and MGX will each be holding a 15% share of half of the new TikTok US joint venture. Of the remaining 50%, a 30.1% will be held by existing ByteDance investors’ affiliates and 19.9% will be retained by TikTok’s Chinese parent company ByteDance, as per the memo detailed by the AP.
Consequently, TikTok’s US business model will lead with a focus to “protect Americans’ data and US national security,” and the venture will be headed by a new, seven-member majority-American board of directors. A system run by Oracle will locally store all US user data.
Lead up to the US TikTok deal
The deal comes after a prolonged period of anxiety as the fate of the popular platform hung in the balance in America. TikTok faced a potential a ban in the US as struggles to find a replacement to China’s ByteDance owner deepened.
However, US President Donald Trump’s first day in office gave the Joe Biden-signed law a run for its money, as the Republican leader’s administration eyed a new sale agreement. And so, the MAGA politician backed multiple executive orders, seeking to extend the deadline for a deal.