TikTok and ByteDance, its Chinese parent company, have signed binding agreements to create a new joint venture that will reportedly be majority-owned by American investors.
The deal, expected to close on Jan. 22, would allow TikTok to continue operating in the U.S. under a law that would have banned the app on national security grounds unless China-based ByteDance divested its U.S. operations. It also hands some control over content moderation and the recommendation algorithm to one of the richest men in the world.
Numerous media outlets reported that the new venture would be called TikTok USDS Joint Venture LLC, citing a memo from TikTok CEO Shou Zi Chew to employees.
The three new managing investors include Oracle, the tech giant founded by Larry Ellison, who currently serves as the company’s executive chairman and chief technology officer. Ellison is an ally of President Donald Trump and the sixth richest person in the world, with a net worth of $233 billion, according to Bloomberg. His son, David Ellison, recently took over Paramount and is looking to buy Warner Bros. Discovery with more than a little help from his father.
The other managing investors include Silver Lake and the Abu Dhabi–based MGX.
Under the terms of the deal, Oracle, Silver Lake, and MGX will reportedly each own 15% of the joint venture. Roughly 30% will be owned by affiliates of current ByteDance investors, while ByteDance itself will retain about 20%. The remaining 5% will go to other new investors.
TikTok did not immediately respond to Gizmodo’s request for comment.
The memo also outlined some potential changes users could expect once the deal closes, including a retraining of the content recommendation algorithm “to ensure the content feed is free from outside manipulation.”
Oracle will also serve as the venture’s “trusted security partner” and will be responsible for auditing and validating that the joint venture complies with agreed-upon national security terms.
U.S. politicians have spent nearly half a decade trying to force ByteDance to relinquish control of TikTok. President Donald Trump first signed an executive order in 2020 demanding that ByteDance sell its U.S. operations.
Congress later passed a law in 2024, eventually signed by President Joe Biden, that would effectively ban the app in the U.S. if ByteDance failed to divest. The Supreme Court upheld the law in January, ruling that a sale of TikTok was necessary to address national security concerns related to its data collection practices and ties to China.
At a forum in May 2024, then-Sen. Mitt Romney linked the overwhelming support for the ban among lawmakers to the perception of pro-Palestinian content on the app.
For his part, Trump delayed enforcement of the ban, giving his allies time to pursue a deal.
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