TikTok’s Chinese parent company, ByteDance, has finalised an agreement to establish a majority American-owned joint venture, a move designed to secure U.S. user data and prevent a ban of the popular app. The deal concludes years of regulatory pressure and national security concerns from U.S. authorities.
Under the agreement, American and global investors will collectively hold 80.1% of the new entity, TikTok USDS Joint Venture LLC, while ByteDance retains a 19.9% stake. The venture will be managed by three lead investors — Oracle, Silver Lake, and Abu Dhabi's MGX — each holding a 15% share. The structure is intended to secure U.S. data, algorithms, and applications through enhanced privacy and cybersecurity measures housed within Oracle's U.S. cloud infrastructure.
Former President Donald Trump, who initially sought to ban the app in 2020, praised the outcome in a social media post, stating TikTok "will now be owned by a group of Great American Patriots and Investors." A White House official confirmed both the U.S. and Chinese governments had approved the arrangement.
The venture will oversee backend operations, including the algorithm and user data, while a separate ByteDance-owned division will manage revenue-generating activities like advertising and e-commerce.
Market sentiment is likely positive, interpreting the deal as a major de-risking event for TikTok's operations in its largest market. By establishing a U.S.-controlled structure for data and algorithms, TikTok mitigates the longstanding regulatory overhang that has threatened its existence in America. This clarity could stabilise the platform's commercial operations and reassure advertisers. For partners like Oracle, the agreement reinforces its strategic role in cloud and data security. However, some investors may remain cautious about the long-term governance complexities of the joint venture structure and the ongoing operational ties to ByteDance. Overall, the resolution removes a significant uncertainty and is seen as a win for continuity, though the technical and commercial execution of the new model will be closely watched.
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