US President Donald Trump signed an executive order just a few moments ago and announced that the Chinese company ByteDance should start preparing for the sale of TikTok's American unit.
It is mentioned in the order that American and some international investors will buy the American ownership of Tiktok. By doing this, it is believed that the US will meet the 'rules of national security' and the data of US users will be protected.
Vice President JD Vance has said that the value of TikTok's American unit will be around $14 billion. This valuation is lower than the market analysts' estimates . "There has been some resistance from the Chinese side, but our main desire is to keep TikTok operating and ensure the data privacy of US users as required by law," Vance told reporters at the White House.
President Trump through an executive order informed that the deadline for banning TikTok under the 2024 law has been moved to January 20, 2025. In the meantime, it will be necessary to separate the American assets from the Chinese company ByteDance, bring in American and other investors, and obtain permission from the Chinese government.
According to Trump's order, Tiktok's algorithm will be under the control of a new company that will be formed in an American joint venture. It will be monitored and retrained by US security experts to ensure that US users' data remains safe and China can't interfere with it.
Trump has claimed to have discussed this with Chinese President Xi Jinping. "There was a good thing between us, I told the plan, he said to go ahead," said Trump. The Chinese Embassy in Washington did not respond to this issue. Neither TikTok nor ByteDance have responded.
TikTok, which has 170 million users in America, has been praised by Trump for contributing to his election victory. His personal TikTok account has 15 million followers, while the White House has recently launched an official TikTok account.
"Tiktak will now be fully under American control," Trump said. He said five "world-class investors" including Dell Technologies founder Michael Dell, Fox News and NewsCor founder Rupert Murdoch will participate in the purchase deal. Oracle and an equity firm, Silver Lake, are said to be taking about a 50 percent stake in TikTok US. ByteDance's existing investors will own about 30 percent . Among them are companies like Susquehanna International Group, General Atlantic and KKR.
ByteDance recently set a total market value of 330 billion dollars in its plan to buy back the shares of Tiktok with its employees (share buyback program). According to analyst Dan Ives, the value of TikTok without the algorithm was estimated to be 30 to 40 billion dollars last April. TikTok's video recommendation system or algorithm is considered to be very powerful.
