President Donald Trump and TikTok announced on Thursday that the company established a joint venture to have the video-sharing app operating in the U.S. under new American leadership.
TikTok’s Head of Operations, Trust and Safety, Adam Presser, will assume the role of CEO of the TikTok USDS joint venture. Presser has spent nearly four years with TikTok and previously worked as a senior executive with Warner Bros.
According to the announcement made on Thursday, TikTok CEO Shou Chew will be a director of the new venture, which will operate as an “independent entity.”
The company said, TikTok USDS Joint Venture “will operate under defined safeguards that protect national security through comprehensive data protections, algorithm security, content moderation, and software assurances for U.S. users.”
In a post in Truth Social on Thursday, Trump rejoiced about the deal, saying that it would now be a “group of Great American Patriots and Investors, the Biggest in the World.”
He also credited the Chinese President Xi Jinping to collaborate with his administration, and “ultimately, approving the Deal.” Trump wrote, “He could have gone the other way, but didn’t, and is appreciated for his decision.” China has not issued an official statement confirming the agreement.
TikTok reported that the new venture will be led by a seven-member board of directors, where the majority of them are Americans. Besides, Chew, the board is comprised of TPG Global’s Timothy Dattels, Susquehanna International Group’s Mark Dooley, Silver Lake co-CEO Egon Durban, DXC Technology CEO Raul Fernandez, Oracle’s Kenneth Glueck, and MGX’s David Scott.
Therefore, ByteDance, the Chinese parent of TikTok, will hold 19.9 percent of the new venture. The new managing investors are Silver Lake, Oracle, and MGX. Other backers include Michael Dell’s investment firm, Vastmere Strategic Investments, Alpha Wave Partners, Revolution, and General Atlantic affiliate Via Nova.
The national security law, which was initially signed by former President Joe Biden, required the company to sell its U.S. operations or be effectively banned in the country.
The enactment of that law never took place because of a series of executive orders signed by President Donald Trump in the previous year. However, the orders also prevented the attorney general from enforcing the national security law as the leaders of the app sought a buyer.
The company said, “Interoperability enables the Joint Venture to provide U.S. users with a global TikTok experience, ensuring U.S. creators can be discovered and businesses can operate on a global scale. TikTok Global’s U.S. entitieswill manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing.”
The company added that the coveted content-recommendation algorithm of TikTok will be hosted now in the American data centers of Oracle and retrained, tested, and updated on American user data.
The statement reported that the new structure also contributes to continuing to operate sibling apps such as CapCut, Lemon8, and other unspecified services and websites in America.
Whilst the Chinese government has not publicly commented on the deal, Semafor earlier reported on Thursday, claiming to have spoken to people close to the deal that the U.S. and the Chinese government had signed the sale and that the deal was likely to close this week.
President Trump declared in September that Chinese President Xi Jinping had agreed to proceed with the suggested deal that was finalized that month through an executive order.
U.S. Vice President JD Vance said there was “some resistance” from the Chinese government to sign the deal, which he claimed would value TikTok business in the U.S. at $14 billion.
CNBC indicated that the Chew revealed the name of TikTok’s U.S. entity to employees in December and stated that it signed an agreement to form a new U.S. joint venture.
