TikTok CEO Shou Zi Chew just announced the company's U.S. operations will move into a newly created joint venture, bringing months of regulatory uncertainty to a critical juncture. The deal, involving Oracle, Silver Lake, and Abu Dhabi's MGX as managing investors, is set to close January 22—effectively salvaging TikTok's American presence while satisfying the Supreme Court-backed national security law that forced parent company ByteDance to divest or face a ban.
TikTok CEO Shou Zi Chew just sent a memo to employees outlining the final structure of the company's U.S. restructuring, and it's detailed enough to signal this deal is actually happening. The new entity, officially called TikTok USDS Joint Venture LLC, will house all American operations and is backed by three major investors: Oracle, Silver Lake, and Abu Dhabi-based MGX. The closing date is January 22, 2026, giving regulators and investors just over a month to finalize the transition.
The ownership split reveals how carefully this deal was engineered to satisfy national security demands. New investors get 50% of the joint venture, with Oracle, Silver Lake, and MGX each holding 15%. ByteDance affiliates retain just over 30%, while ByteDance itself keeps approximately 20%. Critically, Chew emphasized that the joint venture will be "majority owned by American investors, governed by a new seven-member majority-American board of directors, and subject to terms that protect Americans' data and U.S. national security."
The security architecture is where Oracle becomes the lynchpin. Beyond being an investor, the database giant will serve as TikTok's "trusted security partner," auditing and validating compliance with what the memo calls "agreed upon National Security Terms." All sensitive U.S. user data will be stored on Oracle's U.S.-based cloud infrastructure, not China-controlled servers. The move immediately spooked investors in the right way—Oracle shares climbed 5% in after-hours trading on the announcement.
But the most technically significant shift involves TikTok's prized recommendation algorithm. The memo states the new joint venture will retrain the core content feed algorithm "on U.S. user data to ensure the content feed is free from outside manipulation." This directly addresses the national security concern that haunted the entire divestiture process—that China could weaponize TikTok's algorithmic reach to influence American public opinion. By retraining on U.S. data only and keeping the algorithm within Oracle's secured infrastructure, the deal theoretically eliminates that attack vector.
