TikTok signs deal to form new US unit with investors, including Oracle,
Silver Lake
[December 19, 2025] By
BARBARA ORTUTAY
SAN FRANCISCO (AP) — TikTok has signed agreements with three major
investors — Oracle, Silver Lake and MGX — to form a new TikTok U.S.
joint venture, ensuring the popular social video platform can continue
operating in the United States.
The deal is expected to close on Jan. 22, according to an internal memo
seen by The Associated Press. In the communication, CEO Shou Zi Chew
confirmed to employees that ByteDance and TikTok signed the binding
agreements with the consortium.
“I want to take this opportunity to thank you for your continued
dedication and tireless work. Your efforts keep us operating at the
highest level and will ensure that TikTok continues to grow and thrive
in the U.S. and around the world,” Chew wrote in the memo to employees.
“With these agreements in place, our focus must stay where it’s always
been—firmly on delivering for our users, creators, businesses and the
global TikTok community.”
Half of the new TikTok U.S. joint venture will be owned by a group of
investors — among them Oracle, Silver Lake and the Emirati investment
firm MGX, who will each hold a 15% share. 19.9% of the new app will be
held by ByteDance itself, and another 30.1% will be held by affiliates
of existing ByteDance investors, according to the memo. The memo did not
say who the other investors are and both TikTok and the White House
declined to comment.
The U.S. venture will have a new, seven-member majority-American board
of directors, the memo said. It will also be subject to terms that
“protect Americans’ data and U.S. national security.”
U.S. user data will be stored locally in a system run by Oracle. The
memo said U.S. users will continue “enjoying the same experience as
today” and advertisers will continue to serve global audiences with no
impact from the deal.
TikTok’s algorithm — the secret sauce that powers its addictive video
feed — will be retrained on U.S. user data to “ensure the content feed
is free from outside manipulation,” the memo said. The U.S. venture will
also oversee content moderation and policies within the country.
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 American officials have previously
warned that ByteDance’s algorithm is vulnerable to manipulation by
Chinese authorities, who can use it to shape content on the platform
in a way that’s difficult to detect.
The algorithm has been a central issue in the
security debate over TikTok. China previously maintained the
algorithm must remain under Chinese control by law. But the U.S.
regulation passed with bipartisan support said any divestment of
TikTok must mean the platform cuts ties — specifically the algorithm
— with ByteDance.
The deal marks the end of years of uncertainty about the fate of the
popular video-sharing platform in the United States. After wide
bipartisan majorities in Congress passed — and President Joe Biden
signed — a law that would ban TikTok in the U.S. if it did not find
a new owner in the place of China’s ByteDance, the platform was set
to go dark on the law’s January 2025 deadline. For a several hours,
it did. But on his first day in office, President Donald Trump
signed an executive order to keep it running while his
administration tries to reach an agreement for the sale of the
company.
Three more executive orders followed, as Trump, without a clear
legal basis, continued to extend the deadline for a TikTok deal. The
second was in April, when White House officials believed they were
nearing a deal to spin off TikTok into a new company with U.S.
ownership that fell apart after China backed out following Trump’s
tariff announcement. The third came in June, then another in
September, which Trump said would allow TikTok to continue operating
in the United States in a way that meets national security concerns.
TikTok has more than 170 million users in the U.S. About 43% of U.S.
adults under the age of 30 say they regularly get news from TikTok,
higher than any other social media app including YouTube, Facebook
and Instagram, according to a Pew Research Center report published
this fall.
Shares of Oracle jumped $9.07, or 5%, to $189.10 in after-hours
trading.
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