TikTok deal: Who will own ByteDance-owned firm's US operations? Contours of deal revealed
&imwidth=600&imheight=450&format=webp&quality=medium "TikTok deal: Who will own ByteDance-owned firm's US operations? Contours of deal revealed")
The agreement would create a US-based version of the social media application. Photograph: (AFP file)
US-China TikTok framework agreement: US President Donald Trump and Chinese President Xi Jinping are expected to sign a deal after talks between them on Friday. A consortium, led by American investors, will reportedly lead the Byte Dance-owned company.
The negotiators in the United States and China have finalised a framework agreement on the transfer of the TikTok operations in the US. The broad contours of the proposed deal have not been officially released. However, reports claim that a consortium of investors will take over TikTok's operations in the country. Oracle Corp, Andreessen Horowitz, and private equity firm Silver Lake Management LLC might take over TikTok'soperations after US President Donald Trump discusses and finalizes the deal following talks with Chinese President Xi Jinping on Friday.
The agreement wouldcreate a US-based version of the social media application, and Oracle, Andreessen, and Silver Lake will be in the consortiumof the new venture.
Here are preliminary details of the US-China TikTok deal
ByteDance Ltd.’s stake, whichis the Chinese-owned parent company of TikTok, will be reduced to below 20 per cent, reported Bloomberg. The agreement was achievedin Madrid after hectic negotiations, months after the United States passed a law requiring the Beijing-based company to divest or face a ban in the American market. The US lawmakers cited national security concerns for not leaving the Chinese company any other choice but to relinquish control of its US operation.
If the deal is finalised after Trump-Xi talks, the transaction would allow TikTok to operate in the US.
Oracle, a cloud services giant, will continue providing its services to TikTok in the US. The company will host the data in the US. The endeavor will be called Project Texas.
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It isn't clear as of now the entire structure of the shareholding and which other companies or individuals will hold a stake in the social media giant.
A Chinese official told the agency that the Chinese company can license an American company to develop its algorithm for the American operation.
CNN reported, citing sources, that the consortium would also be operated by a majority-US board, including a member appointed by the Trump administration.