ByteDance Signs Deal to Cede Control of TikTok’s U.S. Operations
In Focus
- ByteDance has signed agreements to establish TikTok USDS Joint Venture LLC
- American and global investors hold an 80.1% stake in the new entity
- The entity will be independent, controlling U.S. data and algorithm security
TikTok’s parent company, ByteDance, has signed binding agreements to establish TikTok USDS Joint Venture LLC, an American joint venture. According to Reuters, TikTok’s U.S. national security agreement brings to an end attempts to force ByteDance to divest operations of the video streaming platform in the U.S. The deal also ends uncertainty around the platform’s operation in the country and will close on January 22, 2026.
Oracle, Silver Lake Buy TikTok U.S. Operations
ByteDance and TikTok signed agreements with three managing investors to form a joint venture named TikTok USDS Joint Venture LLC. The investors in the deal are the tech-focused private equity firm Silver Lake, cloud service provider Oracle, and Abu-Dhabi-based AI-focused investment firm MGX.
“We have signed agreements with investors regarding a new TikTok U.S. joint venture, enabling over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community,” TikTok CEO Shou Zi Chew stated in a memo to employees as per Reuters.
The Chinese firm did not reveal the financial terms of the deal. However, the U.S. Vice President JD Vance had mentioned in September 2025 that TikTok’s new U.S.entity could be valued at around $14 billion.
A Major Milestone for TikTok
The ByteDance and TikTok U.S. joint venture marks a significant milestone for the video streaming platform. A TikTok ban was to be effected earlier this year after the divest or ban law took effect on January 19, 2025.
However, President Donald Trump delayed the ban through an executive order upon taking office in January 2025. He also proposed a joint venture where the U.S. gets a 50% stake as a way of resolving the ban.
The deal will see American and global investors control 80.1% of the TikTok U.S. joint venture. ByteDance holds a 19.9% stake as per the order signed by President Trump in September 2025 approving TikTok’s purchase. Silver Lake, Oracle, and MGX will collectively hold a 45% stake in the new entity.
Concerns Over ByteDance’s Role Persist
In September 2025, the White House said the U.S. joint venture will operate the American version of the TikTok app. However, questions on the relationship between ByteDance and the new entity abound.
In the memo to TikTok employees, Chew stated that the joint venture will run as “an independent entity with authority over U.S. data protection, algorithm security, content moderation and software assurance.”
Despite divestiture requirements focusing on giving the U.S. more control over the American business, Chew added that ByteDance U.S. entities “will manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing” separately.
