TikTok agrees to sell US entity – Deal details revealed
TikTok’s US entity to move under control of new investors (photo: Getty Images)
Social media platform TikTok has signed an agreement to spin off its US entity into a separate company with the support of US President Donald Trump, according to CNN.
A step toward keeping TikTok in the US market
Although the deal is not yet finalized, this move brings TikTok closer to securing a long-term presence in the US. It aims to comply with a law passed last year requiring the American version of the app to be separated from its parent company, ByteDance.
Donald Trump repeatedly delayed the law’s implementation, pushing for control of the platform to be transferred to American investors.
“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 memo from Shou Zi Chew states. TikTok declined to comment on the information.
Who will control TikTok in the US
Under the terms of the agreement, the American version of TikTok will be managed by a new joint venture:
-
50% of the company will go to a consortium of investors, including tech giant Oracle, investment firm Silver Lake, and MGX, a fund backed by UAE investors;
-
Just over 30% will be held by affiliate structures of some existing ByteDance investors;
-
19.9% will remain with ByteDance.
TikTok CEO noted that several conditions still need to be met to finalize the deal, but the parties expect to close it by January 22, 2026. Both ByteDance and TikTok have agreed to the proposed terms.
US requirements and China’s role
In September, the Trump administration announced that an agreement had been reached with China to transfer control of TikTok’s US business to a predominantly American investor group. The president signed an order recognizing the deal as a qualified asset sale and postponed the enforcement of the law banning or requiring the sale of TikTok for 120 days.
The US law, which formally came into effect in January, prohibits TikTok from operating in the country unless ByteDance sells roughly 80% of its American assets to investors not affiliated with China.
Algorithms, data, and moderation
The new US company will retrain TikTok’s algorithms using data from American users. Oracle will oversee the storage of US user data. Additionally, the joint venture will handle content moderation for US users.
However, as noted in the memo, TikTok’s global structure under ByteDance will retain control over e-commerce, advertising, and marketing on the American platform.
Necessary approvals
The deal will require approval from Chinese authorities. Donald Trump previously stated that Chinese President Xi Jinping supports the agreement, though Beijing has not officially confirmed this. Regulatory approvals will also be needed in both countries.
Commenting on the situation, Chinese Foreign Ministry spokesperson Guo Jiakun said that specific questions should be addressed to the relevant Chinese agencies and emphasized that Beijing’s position on TikTok remains consistent and clear.
