China set to hand over TikTok's technological aspects to an unknown entity
In a significant development, TikTok, the popular social media platform owned by Chinese company ByteDance, has reached a consensus on a new deal with a consortium led by Oracle (ORCL.N) and including major financial investors such as Andreessen Horowitz and Silver Lake. The consortium is expected to acquire the majority stake in TikTok's US business, with ByteDance retaining approximately 19.9% ownership, just below the 20% threshold.
The successful conclusion of this deal could set a precedent for future international technology agreements. The U.S. had expressed concerns about the possible transfer of user data to China, which was one of the reasons for starting the negotiations. However, the new agreement's terms are aimed at ensuring user data security and compliance with legal requirements.
The framework agreement also includes China's commitment to issue export permits for technology in accordance with existing laws and regulations. China opposes the politicization, instrumentalization, and use of technology and trade for military purposes and will firmly defend its national interests, lawful rights, and interests of Chinese enterprises.
The deal is strategically important for TikTok's further global development. The Wall Street Journal reported that Silver Lake also plans to invest in the TikTok deal, with the remaining 80% stake held by the consortium that includes Susquehanna International Group (SIG), General Atlantic, KKR (KKR.N), and new investors such as Andreessen Horowitz.
The U.S. President Donald Trump and Chinese President Xi Jinping are expected to confirm the agreement on TikTok in a planned phone call. People's Daily, China's official newspaper, commented that the deal is based on principles of mutual respect, peaceful coexistence, and mutually beneficial cooperation.
TikTok remains one of the most popular social platforms worldwide, with continuing influence. The consortium holding the 80% stake also includes current ByteDance shareholders, indicating a joint commitment to the platform's success. No further details about the ownership structure have been disclosed at this time.
This development marks a significant step towards addressing concerns about data security and international technology agreements. As negotiations continue, it is hoped that this precedent will pave the way for similar agreements that prioritize user privacy and cross-border collaboration.
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