TikTok’s US workers can finally breathe a sigh of relief.
The company announced Thursday that it has closed a deal to spin off parts of its US business in a new joint venture with an investor group.
“The safeguards provided by the Joint Venture will also cover CapCut, and Lemon8, and a portfolio of other apps and websites in the US,” the company said.
Adam Presser is leading the new venture, according to the company’s announcement. Presser has worked at TikTok for nearly four years, most recently leading operations and trust and safety. The venture’s seven-man, majority-American board includes TikTok’s CEO Shou Chew.
The agreement should keep the US government off its back as TikTok’s parent, ByteDance, now owns just under 20% of the new US venture. That ownership stake meets a divestment requirement set by a 2024 US sell-or-ban law targeting TikTok and other apps with owners based in countries like China, which the US has deemed a foreign adversary.
TikTok’s new US owners include tech company Oracle, private-equity firm Silver Lake, and Abu Dhabi investment firm MGX, each of which owns 15% of the new venture. ByteDance will own around 20% of the entity, and affiliates of existing ByteDance investors will own around 30%, according to a December memo from Chew. Other investors include Michael Dell’s family office and a venture run by the partners of growth investor Dragoneer.
What comes next is less clear.
While Oracle, MGX, and Silver Lake will serve as managing investors in the new US joint venture, their focus will be on areas such as data security. Key commercial activities, including e-commerce, advertising, and marketing, will remain with ByteDance.
The company began splitting up its US staff into different legal entities in January based on whether their work would remain under ByteDance’s purview, Business Insider first reported.
