TikTok has signed deal to create US joint venture and avoid shutdown — what it means for you

It looks like the long saga of whether TikTok owner ByteDance will sell the U.S. portion of its beloved social video app is about to come to a close. A new report claims that ByteDance, the Chinese owner of TikTok, is ready to divest its U.S. entity to a joint venture controlled by American investors.

According to Axios, which claims to have seen an internal memo, ByteDance and the American joint venture have a deal signed and ready to go.

This has been quite the back-and-forth, with a TikTok ban sitting on the table for the last couple of years (though, aside from a brief removal, delays have kept the app accessible to U.S. users).

ByteDance was forced to sell the company's U.S. operation to domestic owners to alleviate national security concerns, and if this deal actually does go through, then it'll address those issues while also keeping TikTok alive and out of the hands of anyone who could be seen as a threat to U.S. security.

President Donald Trump first issued an executive order in 2020 demanding that ByteDance sell its U.S. operations, and it took more than five years for that move to actually happen, assuming this news is accurate.

Who's buying TikTok?

The new venture, which is aptly named TikTok USDS Joint Venture LLC, is in the hands of Oracle, private equity firm Silver Lake and Abu Dhabi-based MGX. Together, these firms will own 45 percent of the U.S. entity. Oracle is run by Larry Ellison, a vocal supporter of the Trump administration.

Almost 33% of the new company will be held by affiliates of existing ByteDance investors. The nearly 20% that remains is set to be retained by ByteDance, the original owners of the popular vertical video application.

The memo states that the new entity will handle U.S. data protection, algorithm security, content moderation and software assurance — the main sticking points that had TikTok on the chopping block for the last few years. Bringing those key functions stateside should let TikTok stick around for the long haul.

The leaked internal memo seen by Axios says the new group "will operate as an independent entity with authority over U.S. data protection, algorithm security, content moderation and software assurance, while TikTok global's U.S. entities will manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing."

How much did U.S. TikTok sell for?

Now we come to the big question: how much is one of the most popular social media apps actually worth when a sale is required (though not as rushed as we expected)?

According to Axios, the deal values TikTok U.S. at around $14 billion. The price doesn't come from the leaked memo, but from a source Axios spoke with. The final number will be announced once everything is made official, but it's safe to say it's a valuable piece of software with its powerful algorithm and massive U.S. user base.

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