Chinese short video platform TikTok announced that it has signed a joint venture agreement with investors, allowing TikTok to continue operating in the United States.

On Thursday (December 18), TikTok CEO Zhou Shouzhi sent an internal memorandum to inform employees that TikTok and the parent company ByteDance had signed a legally binding agreement to sell American business to a newly established joint venture controlled by American investors. This transaction is expected to be completed on January 22nd next year.

According to the memo obtained by US media, Zhou Shouzi said, "We have signed an agreement with investors to establish a new TikTok US joint venture. This allows over 170 million Americans to continue exploring a world full of infinite possibilities and become a part of this crucial global community. ”

The new joint venture is named TikTok USDS Joint Venture LLC, with new investors holding a 50% stake.

The shareholding details are the same as the agreement announced in September, with software giant Oracle, private equity firm Silver Lake, and Abu Dhabi based MGX each holding 15% of the new entity; Some affiliates of existing investors hold 30.1% of ByteDance shares; ByteDance reserves 19.9% to meet the ceiling of 20% foreign ownership stipulated by the US National Security Act.

Zhou Shouzi pointed out in the memo that the new joint venture will be an independent entity with decision-making power over protecting US data, ensuring algorithm security, content auditing, and software assurance. TikTok's global US entity will manage global product interoperability and specific commercial activities, including e-commerce, advertising, and marketing.

Chinese regulators have not yet said whether to approve the transaction, and ByteDance has not responded.

After returning to the White House in January this year, Trump ordered TikTok to be "banned if not sold", but the deadline was changed multiple times. In September of this year, the Trump administration announced that it had reached a consensus with China to transfer control of TikTok's US business to American investors. Subsequently, Trump signed an executive order confirming the sale of TikTok's US business to American and international investors.  

If this transaction can ultimately be completed, it may be seen as eliminating a long-standing issue in Sino US diplomatic relations and sending a signal of progress in extensive bilateral negotiations. However, experts believe that for ByteDance, this is a compromise after all, just to avoid losing the lucrative market of the United States.

Li Chengdong, founder of Dolphin Think Tank, who focuses on the e-commerce market, told AFP: "For ByteDance, it is a victory to maintain the normal operation of American business."

Zhang Yi, CEO of Chinese data consulting firm iMedia Consulting, believes that this transaction does not guarantee smooth sailing in the future. The US may still use its regulatory power to make unfair demands on TikTok. ”

This transaction is also facing questioning voices within the United States. Democratic Senator Warren said there are still many unanswered questions.

Warren posted on social media platform X on Thursday that Trump has given his billionaire friends more control over what people watch. The American people have the right to know whether the President has reached another opaque deal for the billionaire takeover of TikTok. ”

Oracle co-founder Ellison is a supporter of Trump. One theory is that this transaction will make Oracle a big winner, including increasing its control over a large amount of US user data and potentially eroding the market share of other media companies.

The sensitive stock market immediately responded to this, with Oracle's stock price rising about 5% after Thursday's trading.

Chinese short video platform TikTok announced that it has signed a joint venture agreement with investors, allowing TikTok to continue operating in the United States.

On Thursday (December 18), TikTok CEO Zhou Shouzhi sent an internal memorandum to inform employees that TikTok and the parent company ByteDance had signed a legally binding agreement to sell American business to a newly established joint venture controlled by American investors. This transaction is expected to be completed on January 22nd next year.

According to the memo obtained by US media, Zhou Shouzi said, "We have signed an agreement with investors to establish a new TikTok US joint venture. This allows over 170 million Americans to continue exploring a world full of infinite possibilities and become a part of this crucial global community. ”

The new joint venture is named TikTok USDS Joint Venture LLC, with new investors holding a 50% stake.

The shareholding details are the same as the agreement announced in September, with software giant Oracle, private equity firm Silver Lake, and Abu Dhabi based MGX each holding 15% of the new entity; Some affiliates of existing investors hold 30.1% of ByteDance shares; ByteDance reserves 19.9% to meet the ceiling of 20% foreign ownership stipulated by the US National Security Act.

Zhou Shouzi pointed out in the memo that the new joint venture will be an independent entity with decision-making power over protecting US data, ensuring algorithm security, content auditing, and software assurance. TikTok's global US entity will manage global product interoperability and specific commercial activities, including e-commerce, advertising, and marketing.

Chinese regulators have not yet said whether to approve the transaction, and ByteDance has not responded.

After returning to the White House in January this year, Trump ordered TikTok to be "banned if not sold", but the deadline was changed multiple times. In September of this year, the Trump administration announced that it had reached a consensus with China to transfer control of TikTok's US business to American investors. Subsequently, Trump signed an executive order confirming the sale of TikTok's US business to American and international investors.  

If this transaction can ultimately be completed, it may be seen as eliminating a long-standing issue in Sino US diplomatic relations and sending a signal of progress in extensive bilateral negotiations. However, experts believe that for ByteDance, this is a compromise after all, just to avoid losing the lucrative market of the United States.

Li Chengdong, founder of Dolphin Think Tank, who focuses on the e-commerce market, told AFP: "For ByteDance, it is a victory to maintain the normal operation of American business."

Zhang Yi, CEO of Chinese data consulting firm iMedia Consulting, believes that this transaction does not guarantee smooth sailing in the future. The US may still use its regulatory power to make unfair demands on TikTok. ”

This transaction is also facing questioning voices within the United States. Democratic Senator Warren said there are still many unanswered questions.

Warren posted on social media platform X on Thursday that Trump has given his billionaire friends more control over what people watch. The American people have the right to know whether the President has reached another opaque deal for the billionaire takeover of TikTok. ”

Oracle co-founder Ellison is a supporter of Trump. One theory is that this transaction will make Oracle a big winner, including increasing its control over a large amount of US user data and potentially eroding the market share of other media companies.

The sensitive stock market immediately responded to this, with Oracle's stock price rising about 5% after Thursday's trading.