AFP: Tech giant Oracle and private equity firm Silver Lake are among the “investor consortium” that is set to take control of TikTok’s US operations, a senior White House official said Monday.
The official, who briefed reporters on condition of anonymity, said there has been “an overwhelming interest” from American and international companies in the investment and tech sectors to take part in the acquisition, but acknowledged that talks are ongoing to pull in additional investors.
The final group will be made up of existing investors in ByteDance, the Chinese tech firm that owns TikTok, “as well as a significant number of new investors who have no affiliation with ByteDance.”
“The full capitalization table is yet to be set, as you anticipated, but again, it’s going to be real household names, I would say, major firms, including Oracle and including the private equity firm Silver Lake,” the official said.
White House spokesperson Karoline Leavitt maintained that “TikTok will be owned by a majority of American investors and controlled by a board of directors with extensive national security and cybersecurity credentials, in partnership with the US government.”
“Oracle will serve as TikTok’s trusted security provider, and they will independently monitor the safety and data security of all US user data on Tiktok’s platform,” said Leavitt.
“American’ data will be stored securely in the United States, without access from China. All US user data will be stored on servers operated by Oracle in the United States, protected from surveillance or interference by foreign adversaries,” she added.
A copy of TikTok’s content recommendation algorithm will be given to the joint venture, and will be “fully inspected and retrained by the security provider on US user data, and then it’s going to be operated by that US entity,” the official said.
ByteDance’s share will dip below 20% in order to ensure compliance with a US law that has threatened to shutter the app on American soil unless major changes are made, including the sale of TikTok’s US operations.
Under US legislation, TikTok was required to have a US owner or be blocked in the US, though President Donald Trump has postponed any ban multiple times since taking office in January.
Under the new agreement, the White House will not have a golden share or equity position in the joint venture that will control TikTok’s US operations, nor will the board have a seat selected by the government, the official said. A golden share allows the owner to outvote other shareholders on specific issues.
The official said Trump will sign an executive order this week declaring that the terms of the deal are in line with US national security interests and extend the moratorium on TikTok’s US ban for 120 days to allow for additional time to finish the deal’s implementation. ByteDance will then sign a framework agreement with at least one managing investor as regulatory reviews are completed.
The valuation of TikTok’s US operations remains uncertain, but the official estimated it would total “many billions of dollars.”
“There’s no final number set against once a full investor consortium is established, that will be in the final implementation documents of the deal, but I have every reason to believe it’s going to be in the many billions,” the official said.
