Trump signs order declaring TikTok sale can move forward
The US President determines that the platform's ownership meets the requirements established by Congress.
WashingtonThe purchase of TikTok in the United States is one step closer to becoming a reality. President Donald Trump signed an executive order this Thursday establishing that the acquisition agreement is a "qualified divestiture" that complies with the law passed by Congress requiring the platform to separate from its Chinese parent company, ByteDance. After repeated extensions, the text postpones the implementation of the rule for another 120 days to allow time to complete the deal.
Last week, after speaking by phone with Xi Jinping, Trump said that the Chinese president approved the purchase of TikTok. However, there has been no official statement from Beijing confirming the agreement. Xi's words after the conversation were that he "welcomed" the negotiations.
The details that are known so far about the agreement are that a new entity will be created in the United States to manage TikTok. It is known that ByteDance, the Chinese parent company, would have less than 20% of the shares in the new parent company to comply with Congressional demands. The technology company Oracle – co-founded by Trump ally Larry Ellison – would be one of the main investors and the one that would store the data of American users without China having access to it. During the signing, Trump has confirmed that Ellison participates in the operations.
In fact, what the new entity will do is reproduce the TikTok algorithm on a platform that would be identical. According to people familiar with the conversations in the Wall Street Journal, the algorithm would be recreated with the supervision of Oracle and the US government.
Other investors who have shown interest in the transaction are Rupert Murdoch –owner of the Wall Street Journal– and his son Lachlan, CEO of Fox. Dell CEO Michael Dell would also participate. Ellison would also lead a consortium of investors that could include asset manager Blackstone, private equity firm Silver Lake, Walmart, and billionaire Frank McCourt.
In principle, the U.S. government will not sit on the board or receive any funds. golden share by TikTok, according to Reuters. However, it is unclear whether the US government will receive a payment as a condition of approving the deal. According to the Wall Street Journal, The US government would charge investors a multi-million dollar fee for making the deal happen.
