TikTok Signs Urgent Deal for U.S. Joint Venture Amid Security Concerns
UPDATE: TikTok has just signed a groundbreaking deal to establish a new U.S. joint venture primarily controlled by American investors, including Oracle Corporation, Silver Lake, and MGX. This development marks a significant step in resolving the long-standing uncertainty surrounding TikTok’s operations in the United States.
In an internal memo obtained by ABC News, TikTok CEO Shou Chew confirmed this major development, stating that the joint venture aims to allow over 170 million Americans to continue enjoying the platform. The urgency of this agreement stems from a law passed by Congress last year that mandates TikTok must divest from its Chinese parent company, ByteDance, to remain operational in the U.S.
The memo emphasizes that there is still “more work to be done” as the company prepares for the closing date of January 22, 2026. Chew highlighted the importance of this deal, saying, “We have signed agreements with investors regarding a new TikTok U.S. joint venture, enabling over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community.”
Under the terms of the agreement, Oracle, Silver Lake, and MGX will each own 15% of the new entity, while 19.9% will be retained by ByteDance, and 30.1% will be held by affiliates of existing ByteDance investors. Notably, MGX operates from the United Arab Emirates. Official statements from Oracle and Silver Lake have not been released as of now.
The urgency of this deal is underscored by ongoing concerns from privacy and free speech experts regarding potential implications of the partnership. Critics point to Larry Ellison, co-founder of Oracle, highlighting the family’s connections to major media outlets and political figures, including President Trump.
The joint venture is structured to adhere to the Executive Order signed by President Trump on September 25, 2025, which mandates that the U.S. joint venture will be majority owned by American investors. The governance will include a new seven-member board composed mainly of American directors alongside stringent terms to safeguard American data and national security.
The memo further specifies that this U.S. joint venture will take responsibility for data protection, algorithm security, content moderation, and software assurance. After the transaction closes, Oracle will serve as the “trusted security partner,” ensuring compliance with National Security Terms.
Earlier in September, the White House announced a “framework deal” to preserve TikTok’s U.S. operations. As part of this framework, a version of TikTok’s algorithm—crucial to its addictive nature—will be brought to the U.S. Joint Venture and managed by Oracle, complying with both U.S. and Chinese laws.
This pivotal moment for TikTok not only impacts the social media landscape but also raises critical questions about data privacy and corporate governance in the digital age. As the situation develops, all eyes will remain on TikTok and its new U.S. partners as they navigate this complex transition.
Stay tuned for more updates as this story unfolds.
