ByteDance, the Chinese owner of TikTok, announced Thursday that it has finalized a deal to create a majority American-owned joint venture to operate the popular short-video app in the United States.
The move is intended to address national security concerns that have threatened a US ban on the platform used by more than 200 million Americans.
The agreement marks a key milestone in a years-long dispute that began in August 2020, when then-President Donald Trump first sought to ban TikTok over worries that user data could be accessed by the Chinese government. The proposed ban was blocked in court.
Under the newly announced structure, American and international investors, including cloud computing company Oracle, private equity firm Silver Lake, and Abu Dhabi-based MGX, will hold an 80.1% stake in the new US-based entity. ByteDance will retain a 19.9% ownership share.
The company said the new app will operate under “defined safeguards that protect national security through comprehensive data protections, algorithm security, content moderation and software assurances for US users.” The agreement also includes related applications such as CapCut and Lemon8.
Former TikTok executives Adam Presser and Will Farrell have been appointed CEO and chief security officer of the new company, respectively. The board of directors will include TikTok CEO Shou Chew, who will continue to lead the company’s global strategy and operations.