TikTok has signed a binding agreement to transfer control of its U.S. operations to a new joint venture led by American investors, a move designed to avert a potential nationwide ban and secure the platform’s future for its 170 million U.S. users, company and legal sources said.
The deal, disclosed in an internal memo to employees by TikTok CEO Shou Zi Chew, outlines the creation of a U.S.-based entity, TikTok U.S. Joint Venture LLC, that will be majority-controlled by U.S. investors, including Oracle, private equity firm Silver Lake and Abu Dhabi-backed MGX, with each expected to hold roughly 15% stakes.
Under the agreement, TikTok and its Chinese parent company ByteDance will retain minority interests in the new venture, with ByteDance holding no more than 19.9% and affiliates of existing ByteDance investors taking approximately 30.1%, according to the memo seen by media outlets.
The U.S. joint venture will assume responsibility for data protection, content moderation, algorithm security and software assurance for its American users, with U.S. user data stored locally and the platform’s recommendation algorithm to be retrained on U.S. data to satisfy national security expectations.
Company officials said additional steps remain before the transaction is completed, with a targeted closing date of January 22, 2026. The arrangement comes after years of political and regulatory pressure in Washington, including a 2024 law requiring TikTok to divest from its foreign owner or face a ban.
TikTok’s deal backed by the Trump administration is viewed as a compromise solution to ongoing concerns from U.S. lawmakers about foreign access to American user data and influence on digital information flows. Beijing’s commerce ministry said it expects companies involved in the agreement to seek solutions compliant with Chinese law and to ensure balanced outcomes for all parties.
The spin-off deal marks a significant milestone in the social media giant’s bid to maintain a foothold in the world’s largest digital market while navigating longstanding geopolitical tensions that have shaped the future of global technology platforms.
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