TikTok finalizes deal for its US entity

"TikTok has finalized the deal for its US entity, with its parent company ByteDance selling majority of its stake to a group of non-Chinese investors. The deal was closed just before the Trump Administration's latest deadline, banning the app in the US unless it was divested from ByteDance, which will only retain 20 percent of the new entity. TikTok's investors will own 80 percent, with Oracle, Silver Lake and MGX, an Emirati-state owned investment firm, taking 15 percent each."

"The terms of the deal were first leaked last month, after TikTok CEO Shou Chew reportedly told employees in a memo that TikTok and ByteDance had agreed to a group of investors. This ends a lengthy saga and months of slow progress as the agreement was being worked out, ensuring that the app will remain available in the US after years of being on the verge of a ban in the country."

"According to TikTok's announcement, the joint venture will protect American users' data with Oracle's secure US cloud environment. It will also retrain TikTok's algorithm on US users' data and will be in charge of content moderation in the US. The entity promises interoperability, as well, promising that users will still get international content and, if they're a creator, viewers. "The safeguards provided by the Joint Venture will also cover CapCut, and Lemon8 and a portfolio of other apps and websites in the US," TikTok said."

ByteDance sold a majority stake in TikTok's US entity to non-Chinese investors, retaining twenty percent. Investors will own eighty percent, with Oracle, Silver Lake and MGX each taking fifteen percent and others including the investment firm of Dell's CEO. The deal closed just before a U.S. deadline that would have banned the app unless divested. The joint venture will store American users' data in Oracle's secure US cloud, retrain TikTok's algorithm on US data, and manage US content moderation. Safeguards will cover CapCut, Lemon8 and other US apps. A seven-member board, mostly American, will oversee the entity including Shou Chew, Egon Durban, Kenneth Glueck and David Scott.

Read at Engadget