After years of political wrangling, legal threats, and mounting uncertainty, TikTok’s future in the United States finally appears to be on firmer ground. The social media giant, owned by Chinese tech heavyweight ByteDance, has signed a deal to spin off its U.S. operations into a new joint venture controlled predominantly by American investors—a move designed to satisfy a 2024 law that would have banned TikTok unless ByteDance relinquished its grip on the app’s U.S. business.
According to an internal memo from TikTok CEO Shou Chew, obtained by ABC News, the new U.S. entity will be owned by a consortium including Oracle Corporation, private equity firm Silver Lake, and Abu Dhabi-based MGX. Each will hold a 15% stake, while ByteDance itself will retain a 19.9% minority share—the maximum allowed under the so-called divest-or-ban law passed by Congress last year. Affiliates of existing ByteDance investors will control an additional 30.1%, and a mysterious group of new investors will receive the remaining 5%.
The deal, first reported by Axios and confirmed by multiple outlets, is expected to close by January 22, 2026. It comes after a tense standoff between U.S. lawmakers and ByteDance, with concerns about data privacy, national security, and foreign influence fueling bipartisan calls for action. President Donald Trump, who played a pivotal role in shaping the negotiations, signed an executive order on September 25, 2025, mandating that TikTok’s U.S. business be majority-owned by American interests and governed by a new, majority-American board of directors. The agreement, TikTok says, complies with these requirements and sets the stage for a new era of oversight and accountability.
"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," Chew wrote in his memo. "There's more work to be done as we move towards the closing date, but this is a significant step forward."
Oracle’s involvement is particularly noteworthy. The company, co-founded by Larry Ellison, has long been seen as a frontrunner in efforts to secure TikTok’s U.S. operations. Oracle will not only take a significant equity stake but also serve as the “trusted security partner” responsible for auditing and validating compliance with national security terms. As Business Insider reported, Oracle’s cloud-based computing centers will house sensitive U.S. user data, and the company will oversee the retraining of TikTok’s recommendation algorithm on U.S. data to ensure the content feed is free from outside manipulation.
Silver Lake, a tech-focused private equity firm, and MGX, a state-owned investment powerhouse from Abu Dhabi chaired by Sheikh Tahnoon bin Zayed Al Nahyan, round out the managing investor group. Both bring deep pockets and considerable experience in technology and artificial intelligence. MGX, in particular, has made waves in the AI space, including a $6.6 billion investment in OpenAI in 2024.
The ownership breakdown is a patchwork reflective of the complex, globalized nature of modern tech deals. While Oracle, Silver Lake, and MGX together account for 45% of the new entity, ByteDance’s 19.9% stake ensures it remains a significant—if now minority—player. Affiliates of previous ByteDance investors, such as KKR, Sequoia Capital, and SoftBank, will control the next largest bloc, though their exact identities remain under wraps. The 5% reserved for new investors has fueled speculation about possible involvement by billionaires Michael Dell and Rupert Murdoch, both previously mentioned by Trump as potential players, though their participation is unconfirmed.
For Oracle, the deal represents more than just a regulatory workaround. As RBC Capital noted in a research note cited by Stocktwits, Oracle’s deeper involvement in TikTok’s U.S. data infrastructure could deliver both strategic and economic benefits, especially at a time when the company faces investor scrutiny over its reliance on major cloud clients like OpenAI. The transaction, valued at roughly $14 billion, will give Oracle a stake in one of the world’s most valuable private companies and position it at the heart of a massive consumer data platform.
Wall Street has responded with enthusiasm. Oracle’s stock jumped about 7% following the announcement, according to CNBC, and has climbed 17% so far in 2025. Evercore ISI, in a note to clients, called the news a "nice win" for the cloud company, highlighting the upside potential for Oracle as it seeks to rebound from a recent pullback tied to concerns about AI infrastructure spending.
The deal is also a relief for TikTok’s vast American user base—over 170 million strong—and the countless creators and advertisers who depend on the platform. For more than a year, they faced the specter of a forced shutdown as U.S.-China tensions simmered and lawmakers pressed for a decisive resolution. The agreement now ensures continuity for users, creators, and advertisers, while aiming to address the national security concerns that have dogged TikTok’s U.S. presence from the start.
But not everyone is convinced the deal goes far enough. Privacy and free speech advocates have raised red flags about the influence of Oracle’s leadership, especially given Larry Ellison’s personal connections to former President Trump and his family’s control of major media assets like CBS through Paramount. Others worry about whether the structure truly eliminates the risk of foreign interference, particularly regarding the control and oversight of TikTok’s powerful content recommendation algorithm.
According to the joint venture’s terms, a copy of TikTok’s algorithm—the so-called “secret sauce” behind its addictive content feed—will be brought under the oversight of Oracle. The algorithm will be retrained on U.S. user data, with the goal of preventing manipulation from outside actors. However, as ABC News and Business Insider reported, Chinese officials have been tight-lipped about the deal, with the foreign ministry referring questions to “competent authorities” and state media suggesting the arrangement is not a sale of the algorithm, but rather a compliance with both U.S. and Chinese laws.
President Biden’s administration, while supportive of the framework deal, has largely deferred to TikTok for public comment. Meanwhile, Chinese state media have signaled that the deal is likely to proceed, with pro-Beijing commentators calling it consistent with China’s legal standards. For now, the world watches as the closing date approaches, with both sides keenly aware of the political and economic stakes.
As the January 22, 2026, deadline nears, all eyes are on the final details—and whether this new American-led TikTok will truly satisfy the demands of lawmakers, regulators, and users alike. For a platform that has upended the social media landscape and become a cultural phenomenon, the next chapter promises to be just as closely watched as the last.
