TikTok has finalized an agreement to sell a sufficient stake in its US operations to comply with the country’s divest-or-ban law, clearing the way for the platform to continue operating in the United States.
The deal, first reported by Axios, The Hollywood Reporter, and CNBC, was confirmed in an internal memo sent by TikTok CEO Shou Zi Chew to employees on Thursday. According to the memo, the company is targeting January 22, 2026, as the closing date for the transaction.
Under the agreement, a new entity named TikTok USDS Joint Venture LLC will be established to oversee TikTok’s US business. Ownership of the joint venture will be divided among new American investors, existing ByteDance investors, and ByteDance itself.
As per the disclosed structure, 50 percent of the joint venture will be held by a consortium of new US-based investors, including Oracle, Silver Lake, and MGX, each acquiring a 15 percent stake. Affiliates of certain existing ByteDance investors will hold 30.1 percent, while ByteDance will retain a 19.9 percent ownership share.
TikTok had briefly gone offline in the United States in January after failing to meet earlier divestment deadlines. US President Donald Trump later granted multiple extensions to allow the company more time to finalize a compliant deal. A framework agreement reached between the US and China in September led to another extension, which expired on December 16. The newly signed arrangements are intended to meet the requirements of an executive order issued on September 25, 2025.
According to the memo, TikTok USDS Joint Venture LLC will be governed by a seven-member board of directors, with a majority of American members. The joint venture will have authority over data protection, algorithm security, content moderation, and software assurance for US users.
TikTok said the US entity will retrain its content recommendation algorithm using US user data to prevent external influence. Sensitive user data will be stored in a secure US-based cloud environment operated by Oracle, which will also act as the trusted security partner responsible for auditing and validating compliance with national security requirements.
Following the completion of the transaction, the joint venture will operate as an independent entity built on TikTok’s existing US Data Security framework. It will have exclusive responsibility for safeguarding US user data, content, and software.
TikTok’s global entities will continue to manage cross-border product interoperability and selected commercial operations, including advertising, marketing, and e-commerce. The company said the changes will not affect advertisers or the user experience of its more than 170 million users in the United States.
The transaction is expected to close within 120 days of the executive order, subject to final regulatory approvals.