Proposed Deal Would Put Oracle, Silver Lake and Andreessen Horowitz in Control of TikTok U.S. Operations
U.S.-led group would own roughly 80% of TikTok under reported agreement as Trump delays enforcement of divestment law to Dec. 16
A reported agreement would place control of TikTok’s U.S. operations in the hands of a U.S.-led group that includes Oracle, Silver Lake and Andreessen Horowitz, with that consortium holding about 80% of the newly formed entity, according to people briefed on the negotiations cited by The Wall Street Journal.
Under the terms described in the report, the new U.S.-run company would oversee TikTok’s operations in the United States, operate under an American-dominated board and include at least one board member designated by the Trump administration. The arrangement is intended to comply with a U.S. divestment law that bars Chinese ownership above 20 percent of apps deemed foreign adversary risks.
The Journal reported that current U.S.-based investors in parent company ByteDance, including Susquehanna, KKR and General Atlantic, would roll their stakes into the U.S. entity. Some investors have said rolling their holdings into the new structure would allow them to defer or avoid capital gains taxes, a point that has raised questions among critics about whether such moves would comply with the 20 percent limit for Chinese ownership set by Congress.
Officials and people familiar with the talks said the U.S. group would license TikTok’s technology from ByteDance, and that user data for U.S. accounts would be stored on Oracle servers. Reporters said the deal terms were discussed during talks between U.S. and Chinese officials in Madrid this week. President Donald Trump said he had reached an understanding on the matter and planned to speak with Chinese President Xi Jinping to confirm it.
Trump told reporters he had “reached a deal with China” and that “these are very big companies that want to buy it.” The White House on Wednesday cautioned that details circulating in the press remained speculative until formally announced by the administration.
In an executive action issued Tuesday, the president delayed enforcement of the divestment law until Dec. 16, extending a prior deadline. The move buys additional time for any negotiated transfer of TikTok’s U.S. business to be finalized and reviewed by U.S. officials.
Beijing’s state-run People’s Daily characterized the reported understanding as based on “mutual respect, peaceful coexistence and win-win cooperation,” signaling official acknowledgment of negotiations, but it did not disclose Beijing’s formal position on the proposed structure.
Legal and national security experts cautioned that licensing arrangements could leave gaps in U.S. oversight. Michael Sobolik, a senior fellow at the Hudson Institute and a China expert, said licensing the recommendation algorithm from ByteDance could run afoul of existing law. Lawmakers known as China hawks have also signaled skepticism, citing concerns that retaining any control or influence by ByteDance over content-ranking systems would leave open avenues for Beijing to shape information flows.
Other details reported included plans to prompt U.S. users to switch to a new, U.S.-controlled version of the app to minimize exposure to any systems remaining under ByteDance’s control. The Journal and other outlets said Oracle would host U.S. user data, while some technical components would be licensed from ByteDance.
Congress passed the divestment law last year amid bipartisan concern about foreign influence and data security. How lawmakers will respond to a licensing-based solution is unclear; some members have pressed for a full and irrevocable divestiture of Chinese control and for statutory assurances that Beijing cannot influence algorithms or content moderation decisions.
Even if participants finalize a transaction, it will likely face intense scrutiny from federal agencies and legislators. The administration has not released a formal proposal, and officials say details remain subject to negotiation and legal review. The next steps identified by officials include further consultations between U.S. and Chinese authorities and formal announcements if and when a definitive agreement is reached.