TikTok has announced a landmark joint venture agreement with a consortium of investors, a move aimed at safeguarding its operations in the United States and averting a potential ban linked to concerns over its Chinese ownership.
According to an internal communication obtained by Hobnob News, TikTok Chief Executive Officer, Shou Chew, informed employees that the company and its parent firm, ByteDance, have agreed to establish a new US-based entity. The joint venture will include major investors such as Oracle, Silver Lake, and Abu Dhabi-based investment firm MGX.
Under the arrangement, the US joint venture will be responsible for critical functions including data protection for American users, algorithm security, content moderation, and software assurance. Chew noted that the entity would also have exclusive authority to guarantee the security of content, software, and user data within the United States.
The ownership structure of the new venture allocates 50 percent to a group of new investors, with Oracle, Silver Lake, and MGX each holding a 15 percent stake. Affiliates of existing ByteDance investors will collectively own just over 30 percent, while ByteDance itself will retain slightly below 20 percent — the maximum shareholding permitted for a Chinese company under current US legislation.
TikTok’s US entities are also expected to oversee certain global operations, including product interoperability and selected commercial activities such as e-commerce, advertising, and marketing.
Chew added that additional regulatory and operational steps remain ahead of the planned January 22 closing date for the deal.
The agreement follows a US law enacted in 2024 that required ByteDance to divest TikTok’s US operations or face a ban, citing national security concerns over data privacy and potential foreign influence. While enforcement deadlines had been extended through executive actions, the new joint venture is designed to meet the legal requirements and ensure TikTok’s continued presence in its largest market.
Industry analysts view the deal as a significant compromise that preserves TikTok’s access to the US market while addressing government concerns. However, some experts caution that regulatory scrutiny of the platform is likely to continue despite the agreement.
For ByteDance, the development is seen as a strategic win, allowing the company to maintain its global momentum while shifting focus toward growth areas such as artificial intelligence and potential future public offerings.
