TikTok owner signs new joint venture deal with US to avoid ban

TikTok’s Chinese owner ByteDance, officially signed binding agreements with international investors to sell a majority stake in its U.S. operations. 

The primary motive behind this agreement is to secure the app's future for its millions of users in the U.S.

The deal would end years of efforts by Washington to force ByteDance to divest its US operations over national security concerns, with the transaction set to be finalized on January 22.

According to a memo sent by chief executive Shou Zi Chew, half of the joint venture will be owned by a group of investors including Oracle, Silver Lake and the investment firm MGX.

The memo further claimed that over 170 million Americans will continue to discover a world of endless possibilities as part of a vital global community.

The agreement further stipulates that ByteDance will maintain a 19.9% stake in the business, while Oracle, Silver Lake, and Abu Dhabi-based MGX will each hold 15%.

According to the BBC, Trump said in September that he had a phone call with China’s President Xi Jinping, to whom he had given the go-ahead to move forward.

Meanwhile, the platform’s future remained uncertain after the leaders met in October. The recent move has sparked concerns over the potential investors.

In this connection, small business owner Tiffany Cianci-who has more than 300,000 followers and nearly four million likes on the platform- hopes the incoming investors will preserve the user experience for entrepreneurs just like her.

Ms Cianci seeks to use TikTok for promotion because the platform offers profit allocation on terms that are more favorable than what competitors like Meta offer.

Nonetheless, the recent deal clearly addresses national security regarding data privacy, and ends the years-long battle to keep the app operational in the U.S.