TikTok finalizes a deal to form a new American entity
[January 23, 2026] By
KAITLYN HUAMANI
TikTok has finalized a deal to create a new American entity, avoiding
the looming threat of a ban in the United States that has been in
discussion for years on the platform now used by more than 200 million
Americans.
The social video platform company signed agreements with major investors
including Oracle, Silver Lake and the Emirati investment firm MGX to
form the new TikTok U.S. joint venture. The new version will operate
under “defined safeguards that protect national security through
comprehensive data protections, algorithm security, content moderation
and software assurances for U.S. users,” the company said in a statement
Thursday. American TikTok users can continue using the same app.
President Donald Trump praised the deal in a Truth Social post, thanking
Chinese leader Xi Jinping specifically “for working with us and,
ultimately, approving the Deal.” Trump add that he hopes “that long into
the future I will be remembered by those who use and love TikTok.”
Adam Presser, who previously worked as TikTok's head of operations and
trust and safety, will lead the new venture as its CEO. He will work
alongside a seven-member, majority-American board of directors that
includes TikTok’s CEO Shou Chew.
The deal ends years of uncertainty about the fate of the popular
video-sharing platform in the United States. After wide bipartisan
majorities in Congress passed — and President Joe Biden signed — a law
that would ban TikTok in the U.S. if it did not find a new owner in the
place of China’s ByteDance, the platform was set to go dark on the law’s
January 2025 deadline. For a several hours, it did. But on his first day
in office, President Donald Trump signed an executive order to keep it
running while his administration sought an agreement for the sale of the
company.
“China’s position on TikTok has been consistent and clear," Guo Jiakun,
a Chinese Foreign Ministry spokesperson in Beijing, said Friday about
the TikTok deal and Trump’s Truth Social post, echoing an earlier
statement from the Chinese embassy in Washington.
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The icon for the TikTok video sharing app is seen on a smartphone in
Marple Township, Pa., Feb. 28, 2023. (AP Photo/Matt Slocum, File)
 Apart from an emphasis on data
protection, with U.S. user data being stored locally in a system run
by Oracle, the joint venture will also focus on TikTok's algorithm.
The content recommendation formula, which feeds users specific
videos tailored to their preferences and interests, will be
retrained, tested and updated on U.S. user data, the company said in
its announcement.
The algorithm has been a central issue in the
security debate over TikTok. China previously maintained the
algorithm must remain under Chinese control by law. But the U.S.
regulation passed with bipartisan support said any divestment of
TikTok must mean the platform cuts ties — specifically the algorithm
— with ByteDance. Under the terms of this deal, ByteDance would
license the algorithm to the U.S. entity for retraining.
The law prohibits “any cooperation with respect to the operation of
a content recommendation algorithm” between ByteDance and a new
potential American ownership group, so it is unclear how ByteDance's
continued involvement in this arrangement will play out.
“Who controls TikTok in the U.S. has a lot of sway over what
Americans see on the app,” said Anupam Chander, a professor of law
and technology at Georgetown University.
Oracle, Silver Lake and MGX are the three managing investors, each
holding a 15% share. Other investors include the investment firm of
Michael Dell, the billionaire founder of Dell Technologies.
ByteDance retains 19.9% of the joint venture.
___
Associated Press writers Chan Ho-him in Hong Kong and Didi Tang in
Washington contributed to this report.
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