President Donald Trump said on Tuesday (US time) he had heard that Oracle 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 US concerns that user data could be passed to China's Communist Party government. He has threatened to ban TikTok in the United States as early as Sunday if ByteDance does not comply.
TikTok’s Chinese parent ByteDance has been ordered by President Donald Trump to divest is US operations.Credit:Bloomberg
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 that he was a fan of Oracle's chairman, Larry Ellison. Trump and top US officials were to meet at the White House on Tuesday to consider a proposal, people familiar with the matter said.
The ByteDance proposal calls for the Committee on Foreign Investment in the United States (CFIUS), 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 on Tuesday to consider ByteDance's proposal, two of the sources said.
It is unclear whether Trump will approve ByteDance's proposal, the sources said, requesting anonymity because the deliberations are confidential. The White House, ByteDance and Oracle did not immediately respond to requests for comment.
While TikTok is best known for dancing videos that go viral among teenagers, US officials have had concerns since last year about whether the personal information of its 100 million US users could be compromised under its Chinese owner.
Oracle’s co-founder and chairman Larry Ellison has conducted fundraisers for Trump’s re-election campaign and its chief executive, Safra Catz, has been a significant donor to the campaign and was a member of the Trump transition team in 2016.Credit:AP
ByteDance's plan calls for restrictions in its control of TikTok, the sources said. It asks CFIUS to agree to operational arrangements similar to those it put in place when it allowed SoftBank Group Corp to acquire US wireless carrier Sprint in 2013, according to the sources. These could include the US government approving board directors at TikTok, as well as its relationships with major vendors, the sources said.
ByteDance is also hoping that Ellison’s fundraising for Trump, as well as Oracle chief executive Safra Catz’s backing of Trump’s transition team four years ago, will boost its chances, Reuters has reported.
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