Trump Approves TikTok Deal for $14 Billion via Executive Order

A proposed deal to keep TikTok operational in the U.S. received a significant boost Thursday, with former President Donald Trump signing an executive order approving a transaction that Vice President JD Vance estimates values the U.S. TikTok business at $14 billion.

The executive order suggests that the agreement aims to satisfy national security concerns by requiring ByteDance, TikTok’s China-based parent company, to divest its U.S. operations to avoid a potential ban. According to the proposed terms, which are pending approval from Chinese regulatory bodies, a newly formed joint-venture company will manage TikTok’s U.S. activities, with ByteDance retaining a minority stake of less than 20%. This structure is intended to assuage concerns about foreign influence over the platform’s data and algorithms.

Key investors poised to play significant roles in the new TikTok U.S. entity include enterprise tech titan Oracle, private equity firm Silver Lake, and Abu Dhabi-based investment fund MGX. These entities are expected to collectively control approximately 45% of the venture, while existing ByteDance investors and potentially new stakeholders will hold the remaining 35%, according to sources familiar with the matter. This diverse consortium of investors reflects a concerted effort to ensure broader ownership and accountability.

While notable progress appears to have been made, ByteDance has yet to formally acknowledge any ongoing transaction. The absence of ByteDance representatives at the signing ceremony underscores the complexities involved in securing final approval from all parties. Moreover, a concrete purchase price remains undisclosed, and there is no confirmation of amendments to Chinese laws that may be essential for the deal to materialize.

Despite these uncertainties, President Trump indicated that Chinese President Xi Jinping had given the deal his blessing, although Vice President Vance suggested that the Chinese government initially exhibited some reluctance before ultimately agreeing to the terms.

Under the proposed framework, Oracle will assume a crucial role in overseeing the security protocols of the app and continuing to provide cloud computing services to the new TikTok U.S. entity. This move reflects the growing emphasis on data security and infrastructure resilience in the digital realm. Trump mentioned that Oracle CEO Larry Ellison is involved in the ownership group and that Oracle is “playing a very big part.”

“It’s owned by Americans, and very sophisticated Americans,” Trump asserted at the signing. “This is going to be American operated all the way.” The statement aims to reassure users and policymakers alike that the platform’s future operations will be guided by American interests and values.

Major ByteDance investors, including General Atlantic, Susquehanna, and Sequoia, are expected to contribute equity to the new TikTok U.S. entity, solidifying their commitment to the platform’s long-term success. ByteDance was reportedly valued at $330 billion last month, highlighting the immense value and potential of its global operations. Analysts have previously estimated that TikTok’s U.S. operations alone could be worth between $30 billion and $35 billion.

Notably, the proposed deal does not involve the federal government acquiring an equity stake or a so-called “golden share” in TikTok’s U.S. operations. This decision likely reflects a desire to maintain a level playing field for private investors and avoid potential conflicts of interest.

Over the weekend, Trump suggested that media mogul Rupert Murdoch and his son Lachlan Murdoch could be involved in the TikTok deal, along with Ellison and Dell Technologies CEO Michael Dell. However, definitive details regarding their involvement remain scarce.

Last week, the president signed an executive order extending ByteDance’s deadline to divest TikTok’s U.S. operations or face potential repercussions under a national security law, which was initially signed by former President Joe Biden. The extension allows for greater flexibility in navigating the complex regulatory landscape and ensuring a smoother transition.

The order also temporarily prevents the Department of Justice from enforcing the national security law until December 16. This provides a temporary reprieve for app store operators like Apple and Google and internet service providers, who could otherwise face penalties for providing services to TikTok’s U.S. operations. This suggests that further negotiation and refinement of the deal are anticipated in the coming weeks.