TikTok CEO Shou Chew told employees of the social media app Thursday that its owner, China’s ByteDance, has signed binding agreements to create a joint venture for the app in the United States, as agreed to in a deal with the Trump administration.
That deal means the U.S. version of TikTok will become majority-owned by American investors, according to a memo obtained by NBC News.
The investors include American tech giant Oracle, the California-based private equity fund Silver Lake and the United Arab Emirates investment firm MGX.
Silver Lake and MGX did not immediately respond to requests for comment. Spokespeople for the White House and the Treasury Department likewise did not reply to requests for comment on the deal.
Oracle declined to comment but shares of the company jumped more than 5% in after-hours trading.
An employee who received the memo said that the internal reaction to the news was generally positive among TikTok's American staff but that most of their colleagues in Asia and Europe had not yet seen the memo or had not yet weighed in on it if they had.
As part of the deal, TikTok U.S. will also be overseen by a “new seven-member majority-American board of directors,” Chew said.
"The U.S. joint venture will be responsible for U.S. data protection, algorithm security, content moderation, and software assurance," Chew wrote in his memo. "It will also have the exclusive right and authority to provide assurances that content, software, and data for American users is secure."
In September, Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng reached a "framework" deal to clear the way for American investors to take control of the U.S. version of the app.
TikTok's legal saga in the United States stems from concerns shared by members of Congress across parties and by the intelligence community that ByteDance's complicated relationship with the Chinese government poses a national security threat to the United States.
Millions of people in the U.S. post videos on TikTok every day, effectively giving the app and its owners access to much more information about people's daily lives than many users realize.
The concerns about the data TikTok collects and how it could be used were the chief drivers behind U.S. lawmakers' decision to take action to curb TikTok in 2024.
Under a bipartisan law passed by Congress, ByteDance was required to divest majority ownership of the U.S. version of the app or face a ban initially set to go into effect in January 2024.
In January, as Donald Trump was preparing to return to office as president, the Supreme Court upheld the law. It rejected TikTok's argument that an outright ban would violate free speech protections.
On Jan. 18, TikTok went offline for U.S. users for about 24 hours, causing an uproar among its millions of loyal fans and influential content creators.
Then Trump announced that he would delay the ban through an executive order as soon as he was sworn in.
That assurance was enough to persuade TikTok to begin restoring service just a day before Trump's inauguration.
The Trump administration repeatedly delayed implementing the law, however, until it could hammer out the contours of an agreement with China. Trump ordered that "the Attorney General shall not take any action on behalf of the United States to enforce the Act for 120 days."
That latest timeline ends Jan. 23. In the memo Thursday, Chew said the agreement will close one day before the deadline.
Oracle, one of the largest investors in the joint venture, is controlled by tech billionaire Larry Ellison. His son, David, recently acquired Paramount Global with approval from the Trump administration. David Ellison is now seeking to buy Warner Bros. Discovery via a hostile bid for more than $108 billion.
Oracle has been a darling of the artificial intelligence boom, ballooning Larry Ellison's fortune to more than $230 billion, according to Bloomberg Billionaires.
The formally signed agreement is the latest sign of a slow thaw underway in the U.S.-China bilateral relationship.
Initially, little progress was made despite multiple meetings between Bessent and his Chinese counterparts.
But after Trump and Chinese President Xi Jinping met in October, Beijing has resumed buying American soybeans and eased export controls on critical minerals.
Now, it appears, the TikTok deal will finally get over the finish line, as well.
