TikTok finally signs U.S. deal so it doesn't get banned – here's what it means for you
ByteDance has agreed to sell off its U.S. business to three key companies under a new LLC
🇺🇸 TikTok is finally signing a deal to avoid getting banned in the U.S.
📝 ByteDance has agreed with investors to divest its U.S. entity to a new joint venture
🏢 The three companies that will own the business are Oracle, Silver Lake, and MGX
🔐 This agreement will enhance security and privacy for U.S. users of TikTok
💰 The deal is worth around $14 billion
It looks like TikTok will be escaping its ever-impending ban in the United States. ByteDance, TikTok’s owner, has agreed to a deal with three American investors to divest the U.S. portion of TikTok’s business, as reported by outlets like The Wall Street Journal and Axios. The new arrangement will fall under a new entity called “TikTok USDS Joint Venture LLC,” which will be owned by Oracle, Silver Lake, and Abu Dhabi-based MGX.
In a memo to employees on Thursday, ByteDance CEO Shou Chew confirmed that the deal was signed and is expected to close on January 22, 2026.
While the transaction, which is valued at around $14 billion according to Axios, isn’t complete just yet, it does secure TikTok’s future in the United States. Over the past few years, the United States government has expressed concerns over TikTok’s security and privacy. Demands for a spin-off of the company’s U.S. operations have piled high, with deadline after deadline forcing TikTok to contemplate how it would “sell” a portion of its business to the U.S. to ease tensions.
It sounds like that deal has finally arrived in the form of the new LLC. The agreement will see about 50% of the business owned by the aforementioned trio of investors, a little over 30% will be owned by “affiliates of certain existing investors in ByteDance,” and 19.9% will be owned by ByteDance itself.
What does this mean for American users of TikTok? Not much in terms of user-facing changes, but it will likely mean greater security and privacy for their data. As confirmed by the Trump administration back in September, Oracle will store all American users’ data under the deal, with the algorithm still controlled by TikTok itself, but will be retrained and moderated by the joint venture. ByteDance will continue to manage things like advertising and e-commerce on the platform.
At this point, it sounds like more work needs to be done behind the scenes to finalize the deal, but afterward, all that’s left is for both parties to sign on the dotted line. We’ll keep you posted when that happens.
Max Buondonno is an editor at The Shortcut. He’s been reporting on the latest consumer technology since 2015, with his work featured on CNN Underscored, ZDNET, How-To Geek, XDA, TheStreet, and more. Follow him on X @LegendaryScoop and Instagram @LegendaryScoop.