The White House has confirmed a deal to transfer ownership of TikTok to a group of US investors.
Donald Trump signed an executive order on Thursday that creates a structure for the investors to take over operations of the Chinese social media company in the US.
White House officials have said the US business software company Oracle will license a copy of TikTok’s recommendation algorithm as part of the deal, in a partnership that will expand on Oracle’s existing management of TikTok’s trove of data collected about its US users.
Trump said at a press conference on Thursday that he spoke with China’s president over the phone and he had “a very good talk with president Xi” and “he gave us the go ahead”. Last week, leaders from both governments met in Madrid, Spain, to discuss trade and also hash out a deal for TikTok’s ownership.
The popular app’s future in the US has been in limbo for more than a year, a saga that began after Congress overwhelmingly voted to pass a law banning the social media app in 2024 unless it found a US buyer. The supreme court upheld the law in January, but on Trump’s first day in office, he signed an executive order postponing the ban. He’s since repeatedly continued to delay its enforcement while the deal was secured, though the ban on TikTok was originally his idea.
Here’s what we know about the deal, including involvement of the Murdoch family of media moguls and Oracle’s Larry Ellison, who briefly dethroned Elon Musk as the richest person in the world two weeks ago.
What are the terms of the deal?
The deal aims to keep TikTok operating in the US, but with new owners who are not affiliated with China. Lawmakers have said the popular social media app, which is owned by the Chinese company ByteDance and has 180 million users in the US, could be used by Beijing to spread propaganda and manipulate users.
At least a dozen investors had expressed interest in taking over TikTok, including a group led by the software giant Oracle. The full panel of investors is still not yet known. According to White House officials, Oracle will be tasked with housing US users’ data and controlling TikTok’s powerful recommendation algorithm, so that information is out of the hands of ByteDance or Chinese officials.
ByteDance will ultimately own less than 20% of the app, a White House official told Reuters, and TikTok in the US will be controlled by a mix of its existing US and global firms and the new investors who have no affiliation with ByteDance.
The agreement requires that all data on US users will be stored in the US on cloud computing infrastructure run by Oracle.
Who is involved?
Trump has said media mogul Rupert Murdoch and his son Lachlan, the CEO of Fox Corporation are part of deal. He said Michael Dell, the CEO of the computer maker Dell, was also involved.
Larry Ellison, the cofounder of Oracle, has long been at the forefront of possible buyers. Trump confirmed Ellison is leading the consortium of investors, which could also include private equity firm Silver Lake and MGX, an investment firm owned by the United Arab Emirates .
Trump called them “world-class investors” and “very sophisticated Americans”.
The new US company will be valued at $14bn, according to JD Vance, a number far lower than the valuation for ByteDance overall, which is estimated to be about $330bn. The US government will not take a board seat or receive a golden share in the new entity , according to Reuters.
Why is this happening?
The idea of banning TikTok originated with Trump in 2020, who said the Chinese-owned app posed a danger to national security. It quickly became a bipartisan issue and Congress overwhelmingly voted to ban the app last year unless it divested from its Chinese owners. The original deadline for the TikTok ban was on 19 January.
Trump switched his stance on TikTok after joining the app while campaigning for president last year, amassing millions of followers and hosting the TikTok CEO, Shou Zi Chew, at his Mar-a-Lago estate in Florida and at the White House. The president credits the social media site for helping him connect with young voters during the 2024 election.
Trump signed his first executive order delaying the TikTok ban in January and has since signed three more orders to postpone enforcement until the deal was reached.
What does the executive order do?
The order outlines the structure of the TikTok deal and certifies that the agreement is legal under US law. The plan will reportedly include a seven-member board controlled by Americans, and TikTok’s secretive algorithm will be leased to its new US owners, according to the White House.
The executive order includes a new 120-day enforcement pause to allow the investors and ByteDance to close the agreement.
What is China’s stance?
The US is confident that the deal with China is complete and does not necessitate further talks with Beijing . Vance told reporters there was some resistance from China, but it’s been settled.
China’s top trade negotiator Li Chengang confirmed the agreement last weekend, as well as issued a warning against the US attempting “suppression” against Chinese companies.
