Biz / Tech

Trump claims Oracle close to TikTok deal

Reuters
Under ByteDance's proposal, the Beijing-based company would keep a majority stake in TikTok's global business and create headquarters for TikTok in the United States.
Reuters

US President Donald Trump said on Wednesday he had heard Oracle Corp was very close to a deal over ByteDance’s TikTok, even as sources said the Chinese company was seeking to keep majority ownership of the popular short video app.

Trump has ordered ByteDance to divest TikTok amid “security concerns,” a claim the company denied. He has threatened to ban TikTok in the United States as early as Sunday if ByteDance does not comply.

Under ByteDance’s proposal, however, the Beijing-based company would keep a majority stake in TikTok’s global business and create headquarters for TikTok in the United States, the sources said. Treasury Secretary Steven Mnuchin said on Monday that ByteDance has also offered to create 20,000 US jobs with TikTok.

Oracle would become ByteDance’s technology partner responsible for the management of TikTok’s data and take a minority stake in TikTok, the sources added.

“I heard they are very close to a deal,” Trump said, adding his administration would be making a decision soon on whether to approve it, and that he was a fan of Oracle’s Chairman Larry Ellison.

The ByteDance proposal calls for the Committee on Foreign Investment in the United States, the US government panel that is overseeing the deal talks, to supervise how TikTok will be operated, one of the sources said.

Mnuchin, who chairs CFIUS, and Commerce Secretary Wilbur Ross were meeting at the White House to consider ByteDance’s proposal, two of the sources said.

Signing off on a deal for TikTok that would allow ByteDance to retain majority ownership would represent a U-turn for Trump and the US government agencies and departments that comprise CFIUS.

Trump signed an executive order on August 14 calling on ByteDance to divest TikTok in the United States.

Some CFIUS experts said the deal’s approval would signal a major departure from the traditional national security reviews of deals driven by US civil servants. “Nothing about this transaction is usual. It appears to be in the hands of the politicians rather than the professional CFIUS staff,” said Paul Marquardt, a regulatory lawyer at Cleary Gottlieb Steen & Hamilton LLP.

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