TikTok confirms deal to create new US venture, averting shutdown by a few hours

TikTok and its Chinese owner ByteDance have officially established a venture to transfer parts of its US business to a consortium of mostly US investors, effectively securing the platform’s future for its 170 million American users.

The company made the announcement on Thursday, hours ahead of a Friday shutdown deadline.

The deal – first outlined by TikTok chief executive Chew Shou Zi in an internal memo last month – was set to close this week, though it had not previously received the formal blessing of both countries.

In a statement, the Chinese embassy in Washington said it had nothing to share on news reports that the deal had received official approval. “China’s position on the TikTok issue has been consistent and clear. I have nothing new to share at the moment,” said embassy spokesperson Liu Pengyu.

The White House did not immediately respond to a request for comment.

Chew told employees in December that TikTok and ByteDance signed binding agreements to create a US joint venture – majority-owned by American investors including Oracle, Silver Lake and MGX – but that there was “more work to be done”.

Upon closing, the US joint venture will operate as an independent entity that will control algorithm security, data protection and content moderation, he said. It will also be governed by a “new seven-member majority-American board of directors”.

South China Morning Post