President Donald Trump has signed an executive order allowing ByteDance, the Chinese owner of TikTok, additional time to divest its U.S. operations in compliance with a 2024 law. This strategic plan outlines a joint venture in which renowned businesses such as Oracle, Dell Technologies, and potentially Fox Corp. will take the helm of TikTok’s U.S. operations.
Oracle, alongside private equity firm Silver Lake and Abu Dhabi’s MGX, are set to be significant investors, acquiring a 45% stake in the newly formed U.S. entity. Notably, Vice President J.D. Vance valued TikTok’s American division at $14 billion. Despite the shift in ownership, ByteDance will retain a 19.9% share, with existing investors keeping a 35% stake.
Security concerns have been a bipartisan issue, with fears of Chinese government access to U.S. user data. However, TikTok has consistently maintained its commitment to safeguarding user information. Under the new arrangement, Oracle will handle data management, supported by a board that includes six American members.
The deal sees Larry Ellison, Oracle’s chairman, investing heavily. Ellison, known for his media interests through Skydance Media, enters the consortium amidst rumors of further media acquisitions. Despite emerging as a notable figure in TikTok’s restructuring, analysts assure that the U.S. entity will operate independently from his other media interests.
The executive order extending the divestiture deadline ensures a seamless transition. Under this new structure, user experience remains unchanged, averting the need for a new app download. This effort to secure TikTok’s operations and data reflects ongoing political and legal discussions surrounding data privacy and security associated with foreign-owned digital platforms.