The US will not hold a golden share or equity position in a new entity that will control TikTok’s American operations, according to a White House official, even as President Donald Trump has taken steps toward unprecedented government involvement in other businesses during his second term.
Under the arrangement for TikTok, the new board will also not have a member selected by the US government, the official said Monday during a briefing call with reporters, providing new details on the US-China agreement after months of negotiations.
The consortium will include Oracle Corp and private equity firm Silver Lake Management LLC, with current owner ByteDance Ltd’s stake dropping below 20% to comply with the national security law. The proposed plan is for Americans to hold six of the seven board seats for TikTok US. The full table of investors has not yet been finalised, the official said.
The details offer additional insight into a plan that would see TikTok’s US operations acquired by a consortium of American investors to comply with a national security law forcing its Chinese parent, ByteDance, to divest.
In recent months, Trump has used his leverage to extract concessions for the US government, including taking an unprecedented equity stake in chipmaker Intel Corp and securing a so-called golden share in United States Steel Corp when he approved its takeover by Japanese firm Nippon Steel Corp.
Golden shares allow governments a say in certain business decisions, an arrangement that is more common in other countries. The president recently invoked those powers to block US Steel from halting production at a plant in Illinois, according to a Trump administration official.
See also: Fed finally gets some backup in lonely fight to stave off Trump
Under the spin-off deal, TikTok will be majority-owned and controlled by Americans, the official on Monday said, adding that the investors would include a mix of US and global firms that have already invested in the company as well as new participants.
Still, many of the finer points of the arrangement have yet to be made public, including the valuation for TikTok, which the official would only characterise as totaling many billions of dollars. Trump is expected to sign an executive order later this week giving investors 120 days to work though implementation documents and regulatory reviews to complete the sale.
Despite those hurdles, the White House does not anticipate needing additional diplomatic negotiations with Beijing over TikTok, the official said. Chinese President Xi Jinping and other officials have acknowledged progress in talks over TikTok but have not publicly offered full sign-off on the terms.
The US operations have been valued at about US$35 billion ($44.9 billion) to US$40 billion, though tech valuations have climbed rapidly with the advent of the artifical intelligence (AI) boom.
