TikTok could finally be out of the woods. US President Donald Trump announced that he had approved a deal among TikTok, Oracle, and Walmart Saturday. This deal would give US companies 53% of the equity in the Chinese-owned app.
The TikTok Deal
The New York Times reports that Oracle and Walmart would create TikTok Global, based in the US. Both companies would hold a 20% stake in the new company.
After this deal, the Wall Street Journal says that ByteDance would still own 80% of TikTok Global. However, US investors hold a 40% share in the Chinese company, which means Oracle and Walmart have majority ownership of Global.
Trump Approval
Gizmodo says that President Trump has approved of the deal. Through the agreement, the US Department of Commerce would delay the TikTok ban for a week. The US government had warned that TikTok sends user data to the Chinese government.
There is now a TikTok deal that has Trump’s "blessing," delaying ban. https://t.co/LvrmjM86w8 pic.twitter.com/CpmwoaNnka
— Gizmodo (@Gizmodo) September 20, 2020
What Will Oracle and Walmart Do?
TikTok also confirmed the deal to Gizmodo. The company said that Oracle would become its technology provider in the US. With this deal, Oracle will store all US user data in secure systems to protect national security.
On the other hand, Walmart will take care of the e-commerce aspect of TikTok. Walmart CEO Doug McMillon would also sit on the board of TikTok Global. Moreover, Walmart plans to let more Americans hold shares in TikTok by creating an IPO in the US.
However, China may respond to this deal by forcing TikTok to shut down in the US. Also, the Trump administration has not yet given formal approval to the deal.
