Washington nears TikTok deal: US firms looking to seize control from China

The White House is nearing approval of a deal that would see American investors take control of TikTok’s US operations, effectively severing ties with its Chinese parent company ByteDance in a move aimed at staving off an impending ban of the popular app.

Under the proposed agreement, a consortium of new US investors– including venture capital firm Andreessen Horowitz, private equity giant Blackstone, and other major financial players– would acquire roughly half of TikTok’s American business, Financial Times reported citing people briefed on the talks.

Existing stakeholders in the video-sharing platform, such as General Atlantic, Susquehanna, KKR and Coatue, are also expected to take part, collectively holding around 30 per cent of the new entity.

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April 5 deadline looming

The planned shake-up comes as a key deadline looms: US legislation set to take effect on April 5 would ban TikTok unless its Chinese ownership divests. ByteDance, based in Beijing, would retain a minority stake capped at just under 20 per cent, in line with the law’s stipulation that no “foreign adversary” hold more than one-fifth of the company.

While the deal is still at a formative stage and could change, President Donald Trump is expected to meet officials this week to review the terms. If he gives his approval, an announcement could follow swiftly. ByteDance and the Chinese government would also need to sign off on the arrangement– an outcome that has appeared more likely in recent days, as Beijing has softened its previous opposition to any forced sale.

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As part of the agreement, Oracle, whose co-founder Larry Ellison is a vocal Trump ally, would be tasked with securing TikTok’s US user data, echoing previous efforts to firewall American information from Chinese access.

However, a critical sticking point remains: control over TikTok’s powerful content recommendation algorithm. One option reportedly being discussed would allow ByteDance to continue operating and developing the algorithm, with the US entity accessing it via a licensing agreement and oversight mechanisms. But critics argue that such a setup would fall short of legislative demands, which many believe require full domestic control over the platform’s core technology.

Adding further intrigue, Amazon, led by Jeff Bezos, reportedly mounted a last-minute bid to acquire TikTok’s US business, as first revealed by The New York Times. Despite that high-profile intervention, the investor-led proposal remains the frontrunner, according to multiple sources close to the talks.