TikTok on Thursday closed a deal to divest its U.S. entity to a joint venture controlled by American investors, the day before the Trump administration's executive order banning the app was set to kick in.
Why it matters: The deal ends a yearslong saga to force TikTok's Chinese parent ByteDance to sell its U.S. operation to domestic owners to alleviate national security concerns.
State of play: With the deal, U.S. tech giant Oracle, private equity firm Silver Lake and Abu Dhabi-based investment firm MGX will collectively own 45% of the U.S. entity, which will be called "TikTok USDS Joint Venture LLC."
- Nearly one-third of the company will be held by affiliates of existing ByteDance investors, some of which are American firms.
- Nearly 20% of the joint venture will be retained by ByteDance.
- New investors include Michael Dell's family office, New York-based investment firm Alpha Wave and Revolution, a Washington D.C.-based venture capital firm co-founded by Steve Case and Ted Leonsis.
Between the lines: The joint venture will be responsible for U.S. data protection, algorithm security, content moderation and software assurance.
- The joint venture will license the company's algorithm from ByteDance and will retrain it on U.S. user data to ensure the content U.S. users see is free from outside manipulation, the company has said.
- After the deal closes, Oracle will act as the security partner responsible for auditing and validating compliance with the agreed-upon national security terms.
Zoom in: Adam Presser was named CEO of the joint venture, while Will Farrell was named chief security officer. Both previously held roles at TikTok and its U.S. data security organization.
- The joint venture's seven-member board consists of: TikTok CEO Shou Chew, TPG Global senior advisor Timothy Dattels, Susquehanna International Group managing director Mark Dooley, Silver Lake co-CEO Egon Durban, DXC Technology CEO Raul Fernandez, Oracle executive vice president Kenneth Glueck and MGX chief strategy and safety officer David Scott.
By the numbers: The deal values TikTok U.S. at around $14 billion, a source confirmed to Axios, which is an extremely low price given that TikTok's U.S. entity makes roughly $14 billion annually in advertising revenues alone, per analyst estimates.
Catch up quick: The White House and the Chinese government hammered out a deal in principle in September to sell TikTok's U.S. operations to a joint venture controlled by a U.S. investor group led by Andreessen Horowitz, Silver Lake and Oracle.
- Terms of that deal have since shifted, in part because of conflicts of interest. Andreessen Horowitz, for example, was an early investor in Facebook, now Meta, and its co-founder Marc Andreessen sits on Meta's board.
- President Trump at one point last year said in a Fox News interview that the investor group is expected to include Michael Dell, Lachlan Murdoch and Rupert Murdoch.
Flashback: Trump first issued an executive order demanding that ByteDance sell its U.S. operations in 2020.
- Congress passed a law in 2024 to ban the app unless it was sold.
- The Supreme Court upheld that law in January 2025, but Trump repeatedly postponed its enforcement through a series of executive orders while his administration tried to negotiate a sale.
Editor's note: This story has been updated with additional context.
