Trump Approves TikTok Divestiture, US Investors to Own Majority Share

The Facts -

TikTok Secures Path Forward in the U.S. with New Ownership Structure

In a move set to reshape the landscape of social media in the United States, President Donald Trump signed an executive order on Thursday that permits the divestiture plan for TikTok, ensuring its continued operation under predominantly American ownership. This development is a result of collaborations between multiple American investors, including Oracle, Silver Lake, and Andreessen Horowitz.

This executive order springs from a bipartisan national security law passed by Congress in 2024, requiring Chinese parent company ByteDance to reduce its stake in TikTok's U.S. operations to less than 20%. The remaining shares will be held by an American investment consortium and ByteDance's previous investors, thereby restructuring control over TikTok's U.S. assets.

A plan has been presented to me to undergo a qualified divestiture of TikTok’s United States operations, as outlined in a framework agreement (Framework Agreement). Under this Framework Agreement, TikTok’s United States application will be operated by a newly established joint venture based in the United States. It will be majority-owned and controlled by United States persons and will no longer be controlled by any foreign adversary, since ByteDance Ltd. and its affiliates will own less than 20 percent of the entity, with the remainder being held by certain investors (Investor Parties).

The order ushers in the creation of a new joint venture that will assume control of TikTok's U.S. assets, including its popular recommendation algorithm. In addition, it institutes measures aimed at safeguarding American user data. This comes amid ongoing concerns about data privacy and security, highlighted by past revelations from figures like Edward Snowden.

An extension has been granted on the deadline for enforcing the original congressional ban, now set for December 16, 2025, providing time to finalize negotiations with China. The takeover also stipulates that the majority of board members will be American, although approval from Chinese authorities remains a requisite for the deal's completion.

The acquisition, driven by intensified anti-China rhetoric in U.S. politics, includes significant financial implications, such as a multibillion-dollar fee to the U.S. government. Oracle, Silver Lake, and Andreessen Horowitz are spearheading the transition, with potential participation from other notable figures and firms, like Fox Corp., Michael Dell, and Lachlan Murdoch.

With the framework in place, TikTok's U.S. technical platform, infrastructure, and algorithm will transition to the American consortium. Oracle will play a pivotal role, directly overseeing TikTok's algorithm retraining and acting as a security authority, as part of its expanding involvement that includes hosting TikTok’s data through Project Texas.

While ByteDance will hold a minority position, it will relinquish access to U.S. user data and algorithmic changes. The platform’s significant draw among U.S. youth is a key factor in this complex deal, which has seen TikTok amass over 170 million American users.

This transaction underscores the ongoing geopolitical and economic tensions between the U.S. and China. It also highlights the strategic interests of American corporations and policymakers in maintaining control over popular social media platforms. The deal, which seeks to navigate U.S.-China relations, demonstrates the broader theme of "decoupling" between the two nations, each maneuvering to protect their economic and technological interests.

For more information, see the original article here.

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