Under the deal with Oracle and Walmart, TikTok will be transferred to a new subsidiary of China’s ByteDance, TikTok Global, which will be 20 percent owned by the two American companies. TikTok writes that in a statement on Monday.
The two companies will buy in during an early round of financing, TikTok said. Oracle takes care of all user data for the US arm of TikTok to “comply with all US security requirements”.
That means that the majority of the company will not be officially owned by US parties, something Oracle and Walmart have promised. Reuters writes that some sources within the organization state that 41 percent of ByteDance is already in the hands of US investors, and therefore there is a US majority.
According to Oracle and Walmart, four of the five directors of TikTok Global will soon be American. In any case, Doug McMillon of Walmart will be on the board, but TikTok called against Reuters also mainly names from the board of the Chinese parent company ByteDance.
TikTok will maintain its US headquarters and place it in Global, it writes in a statement. The algorithms behind TikTok remain in the hands of ByteDance. The company will pay $ 5 billion ($ 4.2 billion) in tax to the United States.
An intended ban on TikTok in the US was shut down this weekend. Trump said the new deal with TikTok would meet his demand that TikTok’s US arm be separated from China.