ByteDance’s TikTok sold operations and signed an agreement with a group of investors. This agreement was executed for its USA operations. The signing occurred on December 18, 2025, according to an internal company memo. The closing of the transaction is scheduled for January 22, 2026.
This move responds to a USA law enacted in 2024. The law stipulated the sale of TikTok’s operations in the country or its ban due to national security concerns. The agreement sought to resolve a years-long conflict between the USA government and the Chinese company ByteDance.
Byte Dance’s TikTok sells operations to USA investors
The negotiation concluded after a period of significant uncertainty. The law requiring divestment went into effect in January 2025, leading to a technical ban of the app for a few hours. The arrival of a new executive administration in the USA government gave a new direction to the process.
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The talks were complex and involved multiple deadline extensions. The USA executive branch issued a series of orders to postpone the enforcement of the law while an agreement was being reached. A previous agreement attempt was thwarted in April 2025 following tariff policy announcements.
Who are the investors that acquired TikTok?
A consortium of investors acquired a majority stake in the new USA entity. This consortium includes three main players.
- Oracle: A cloud software and technology company that will act as the «trusted security partner» for the new TikTok USDS Joint Venture LLC, storing local data.
- Silver Lake: A private equity firm that is part of the investor consortium.
- MGX: An investment fund based in Abu Dhabi that completes the trio of new managing investors.
The final ownership structure is as follows: the consortium of new investors controls 50%, while ByteDance retains 19.9%, and affiliates of its existing investors own the remaining 30.1%. A seven-member board of directors, predominantly American, will oversee the new company.
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New algorithm dynamics
The operation of the content recommendation algorithm will undergo key changes. This algorithm, considered the heart of the platform, will remain the property of ByteDance in China. However, its operation for users in the USA will be subject to new conditions.
The new USA entity will have the responsibility to «retrain» that algorithm. This retraining will be performed using only USA user data, with the stated goal of ensuring that the content flow is free from external manipulation. The company Oracle will audit and validate compliance with these agreed-upon security terms.
What are the background details of the acquisition?
The acquisition attempt fits within a geopolitical and security dispute. For years, USA lawmakers expressed concern about the risk of the Chinese government accessing USA user data or manipulating content.
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These concerns led to the bipartisan approval of a divestment law in 2024. The operation sets a precedent for the governance of global technology platforms in an environment of geopolitical distrust.
The resulting structure, which combines local ownership with foreign technology licensing, could model future regulatory agreements in other sectors. Its success will depend on the new administration’s ability to balance commercial innovation with the security requirements demanded by authorities.
