Home > Business > Tech

TikTok seals deal for new U.S. joint venture to avoid ban

Published: 23 Jan. 2026, 14:40

A man stands near a giant sign for Chinese company ByteDance's app TikTok, known locally as Douyin, during China Fashion Week in Beijing on March 31, 2025. [REUTERS/YONHAP]

TikTok's Chinese owner, ByteDance, on Thursday said that it has finalized a deal to establish a majority U.S.-owned joint venture that will secure U.S. data to avoid a U.S. ban on the short video app used by over 200 million Americans. The deal is a milestone for the social media firm after years of battles that began when U.S. President Donald Trump tried to ban the app over national security concerns in August 2020.

Trump later opted not to enforce a law passed in April 2024, which required ByteDance to sell its U.S. assets by the following January or face a ban — a measure upheld by the Supreme Court.

ByteDance said TikTok U.S. Data Service Joint Venture (TikTok USDS JV) will secure U.S. user data through privacy and cybersecurity measures. It disclosed few details about the divestiture.

Trump praised the deal in a social media post, saying TikTok “will now be owned by a group of Great American Patriots and Investors, the Biggest in the World.”

He thanked Chinese President Xi Jinping “for working with [the United States] and, ultimately, approving the Deal. He could have gone the other way, but didn’t, and is appreciated for his decision.”

The agreement provides for U.S. and global investors to hold 80.1 percent of the venture, and ByteDance will own 19.9 percent.

TikTok USDS JV's three managing investors — cloud computing giant Oracle, private equity group Silver Lake and Abu Dhabi-based investment firm MGX — will each hold 15 percent.

A view of the TikTok office in Culver City, California, is seen in this file photo from April 2, 2025. [REUTERS/YONHAP]

A White House official told Reuters that the U.S. and Chinese governments had signed off on the deal. The Chinese Embassy in Washington did not immediately comment.

Trump last year said the deal met the terms of divestiture requirements under the 2024 law. The White House in September 2025 said the venture would operate TikTok's U.S. app. Interested parties have yet to disclose elements of the deal, such as the business relationships between the venture and ByteDance.

The president has more than 16 million followers on his personal TikTok account and credited the app with helping him win re-election. He received a document from TikTok on Dec. 22 last year and touted how popular he is on the app, as shown in a photo published this month by the New York Times. The White House also launched an official TikTok account in August 2025.

TikTok said investors in the venture include Dell Family Office — investment firm of Dell Technologies founder Michael Dell — plus Vastmere Strategic Investments, Alpha Wave Partners, Revolution, Merritt Way, Via Nova, Virgo LI and NJJ Capital.

Former TikTok USDS figures Adam Presser and Will Farrell have been appointed CEO and chief security officer, respectively.

People pose for a photo while holding smartphones in front of the TikTok logo on Sept. 11, 2025. [REUTERS/YONHAP]

TikTok CEO Shou Chew was also named to the venture's board; he leads TikTok's global business and strategy.

The venture will retrain, test and update TikTok's content recommendation algorithm on U.S. user data, and the algorithm will be secured in Oracle's U.S. cloud, TikTok said.

In September last year, Reuters reported, citing sources, that ByteDance would maintain ownership of TikTok's U.S. business operations but would cede control of the app's data, content and algorithm to the venture.

The venture will serve as backend operations to the U.S. company and handle U.S. user data and the algorithm, sources said at the time. They said a separate division wholly owned by ByteDance would control revenue-generating business operations, such as e-commerce and advertising.

The new venture will receive a portion of revenue for its technology and data services, the sources added.

Reuters