U.S. President Trump announces transfer of TikTok ownership to American corporations, postponing the impending ban deadline, due to a settlement with China.
In a significant development, TikTok's U.S. business is set to have new owners as an investor consortium, led by Oracle, Andreessen Horowitz, and other American investors, takes control. The consortium also includes Susquehanna International, KKR, and General Atlantic.
The move comes amidst concerns over potential data sharing with Chinese authorities and national security risks. TikTok has repeatedly denied these claims.
The U.S. government has been pushing for a sale of TikTok's U.S. operations due to the app's ties to ByteDance, a Chinese company. The first executive order requiring ByteDance to sell the app's U.S. operations was signed into law in 2024 by then-President Joe Biden.
The deal, if finalised, is expected to shape the tone of future U.S.-China negotiations in the coming months. Trump has plans to speak with Chinese President Xi Jinping to finalise the arrangement.
China will review issues related to TikTok's technology exports and intellectual property licensing before finalising the arrangement. The Justice Department is barred from taking enforcement action during the extended period and retroactively for any actions dating back to Jan. 19, 2025.
ByteDance is expected to retain less than 20% of the U.S. unit of TikTok. Other potential bidders mentioned earlier by Donald Trump included Oracle's Larry Ellison, Tesla's Elon Musk, the AI startup Perplexity, and Frank McCourt's Project Liberty initiative.
The framework deal for TikTok's U.S. operations has been confirmed by China. The outcome of the negotiations is anticipated to provide clarity on the future of TikTok in the U.S., potentially averting a nationwide ban that was initially threatened over national security concerns.
The measure is designed to restrict applications owned by companies with ties to foreign governments considered national security risks. The agreement between the U.S. and China on TikTok is described as based on "mutual respect, peaceful coexistence, and win-win cooperation" by the state-run People's Daily.
This development marks a significant step towards resolving the long-standing issue of TikTok's operations in the U.S., providing a potential relief for the millions of users who enjoy the platform. The finalisation of the deal is eagerly awaited by both parties involved.
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