Tech giant Oracle has won the bidding war to buy social media platform TikTok’s US operations.
US President Donald Trump has given his “blessing” to the deal which sees the creation of a new company, TikTok Global.
This organisation is a collaboration between current Chinese owner ByteDance, who will own 80% of the shares, and two US companies – Oracle (which would have a 12.5% stake) and Walmart (7.5% stake).
The video-sharing app was given a deadline of 15 September by President Trump to sell its American outfit to a US company or shut down in the States altogether.
This came after White House claims that Chinese owned apps, including TikTok and WeChat, were “active participants in China’s civil-military fusion” and collected “vast swaths of data from users, including network activity, location data, and browsing and search histories.”
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The Chinese government is yet approve the deal and it is not exactly what Trump envisioned as he originally demanded an outright sale of TikTok to a US firm, but he did say the deal would provide new jobs and tax revenue for the country.
Trump on Saturday 19 September said: “If they get it (the deal) done, that’s great. If they don’t, that’s OK too.”
He added that the new company will be hiring at least 25,000 people and making a $5bn contribution to an American education fund. However, ByteDance was not aware of such an education fund being part of the deal.
Oracle will host all TikTok’s US user data, provide computer systems and inspect ByteDance’s source code to ensure that national security requirements are met as ByteDance stated that it will not transfer its technology and algorithm to Oracle.
Walmart will provide a mixture of ecommerce and payment services.
Four of the five board members of the new company will be Americans. TikTok Global will oversee the money and decide how it is invested.
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