TikTok's long-awaited US divestiture deal won't close for at least another month, sources tell CNBC, even as Treasury Secretary Scott Bessent confirmed a framework agreement between the US and China. The delay comes just days before TikTok's latest deadline expires, while Oracle remains locked in as the app's cloud infrastructure partner.
The TikTok saga takes another turn as sources close to the negotiations reveal that finalizing the app's US divestiture could stretch into November. CNBC's David Faber reported Monday that despite Treasury Secretary Scott Bessent's announcement of a framework deal, the actual closing won't happen for another 30 to 45 days.
The delay adds fresh uncertainty to TikTok's fate as its latest divestiture deadline expires Wednesday. President Trump, who has already granted three extensions, is expected to confirm the deal Friday - but it's unclear whether he'll offer yet another extension while negotiations wrap up.
Oracle emerges as the clear winner in this arrangement, cementing its role as TikTok's U.S. cloud infrastructure partner. The tech giant will continue routing American user data through domestic servers, a relationship that started during the first Trump administration and survived multiple political transitions.
The deal structure looks notably different from earlier speculation about massive buyouts. "I'm hearing it's actually going to be relatively small in terms of the actual size of the checks that are written for the entity itself, and it will not be something that is going to go public at some point," Faber said during CNBC's Squawk on the Street.
This suggests the arrangement focuses more on operational control and algorithm licensing rather than a traditional acquisition. The Information reported Tuesday that the US and China reached agreement on licensing TikTok's algorithms and intellectual property rights - the crown jewels that make the app's recommendation engine so addictive.
A consortium of investment firms, including some existing ByteDance shareholders, appears positioned to take operational control of TikTok's US business. This hybrid approach lets China maintain some economic interest while satisfying Washington's national security concerns about direct Chinese control.
The timing crunch creates political theater around Wednesday's deadline. The Protecting Americans from Foreign Adversary Controlled Applications Act, signed by President Biden last year, mandates that TikTok divest from ByteDance or face a US ban. Trump's willingness to grant extensions has kept the app operating, but each delay tests the boundaries of executive authority.
