The Commerce Department said on Saturday it would delay an order that was due to go into effect Sunday night and that would prevent Alphabet Inc.’s Google and Apple Inc. from offering TikTok in their U.S. app stores for a week.
A person briefed on the case said the administration gave the parties a week to complete the deal.
U.S. shareholders are expected to control 53% of TikTok Global, a person briefed on the matter said, while Chinese investors would own 36%.
Trump said the new company would be “totally controlled by Oracle and Walmart… All control is Oracle and Walmart. ”
Oracle has said it will take a 12.5% stake in TikTok Global.
TikTok said as part of the deal, Oracle and Walmart will take part in a pre-IPO financing round from TikTok Global in which they could take up to a 20% cumulative stake in the company.
The remaining 80% will be held by ByteDance, but it is not clear whether TikTok Global’s ByteDance shares will be distributed to ByteDance investors when TikTok Global is incorporated, according to the source.
US investors currently own around 40 percent of ByteDance.
TikTok said it was “happy that the proposal from TikTok, Oracle and Walmart will resolve the security concerns of the US administration and settle questions regarding the future of TikTok in the United States”
TikTok said Oracle will become the “Company’s trusted technology provider, responsible for hosting all US user data and securing associated computer systems to ensure that US national security requirements are fully met. “.
‘I gave my blessing to the deal’
Trump has offered strong support for the deal he said would create 25,000 jobs in the United States. “I gave my blessing to the deal,” Trump said. “I approve of the deal in concept. ”
About 100 million Americans use TikTok, and U.S. officials have expressed concern about user data and the potential for China to access that data.
“Security will be 100%,” Trump told reporters.
Reuters reported on Thursday that TikTok Global would have a majority of US directors, a US chief executive and a security expert on the board.
ByteDance has accepted strong security guarantees on US user data, with Oracle hosting all data and obtaining the right to inspect TikTok source code.
Walmart did not immediately comment.
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Trump expressed his displeasure this week that government lawyers told him it was not permissible to demand a “part” of TikTok’s sale price for the Treasury.
He said there would be a US $ 5 billion education fund as part of the deal. “It was their contribution that I was asking for,” Trump said.
He said the new company would most likely be incorporated in Texas and have at least 25,000 employees.
The education fund is news for Bytedance
However, Bytedance said in a social media post on Sunday that it was the first time he had heard in the news that he was setting up a $ 5 billion education fund in the United States.
US President Donald Trump said he had approved a deal, which included a $ 5 billion education fund, to allow TikTok to continue operating in the United States.
“The company is committed to investing in education and plans to work with global partners and shareholders to launch online classroom projects based on AI and video technology for students around the world. “, ByteDance said on its official account on Toutiao, a Chinese content platform.
China has yet to approve the deal
Reuters reported Thursday that ByteDance is planning an initial US public offering of TikTok Global. The filing of an IPO for TikTok Global would be on a U.S. stock exchange and could take place in about a year, the sources said, requesting anonymity as the matter is confidential.
Some of the proceeds from the IPO are expected to be used to fund the $ 5 billion U.S. education fund, the source said. ByteDance and Oracle did not immediately respond to requests for comment.
China has yet to approve the deal. “We’ll see if it all goes or not,” Trump said.
Texas Gov. Greg Abbott said on Twitter earlier that he spoke to Trump about the deal. “I let him know that if he approves the deal, Texas would be the perfect location for the HQ,” Abbott said.