TikTok’s long-debated US “sale” is not quite what it seems. An internal memo from CEO Shou Chew shows that while new US investors are coming on board, control over the app’s core money-making businesses will remain with ByteDance.

TikTok has signed an agreement to spin parts of its US operations into a new joint venture. The move comes after months of political pressure and legal uncertainty over the app’s future in the United States.

Under the deal, Oracle, Abu Dhabi-based investment firm MGX, and private-equity firm Silver Lake will become managing investors in the new US entity.

Who will control what

According to the memo, viewed by Business Insider, the new investors will not oversee TikTok’s main commercial activities.

Instead, they will focus on national security-related responsibilities, including US data protection, algorithm security, content moderation, and software assurance.

TikTok’s global operations, which remain under ByteDance, will continue to manage e-commerce, advertising, and marketing. This includes TikTok Shop and ad sales, the platform’s primary revenue drivers.

“Advertisers will continue to connect with global audiences with no impact,” Chew wrote to staff.

Structure of US joint venture

The US joint venture will be built on the existing TikTok US Data Security (USDS) framework. It will operate as an independent entity responsible for safeguarding US user data and addressing regulatory concerns.

Meanwhile, TikTok’s global US entities will handle product interoperability and commercial activities tied to the wider international business.

Ownership breakdown explained

Under the proposed structure, Oracle, Silver Lake, and MGX will collectively hold a 45% stake in the US joint venture.

Affiliates of existing ByteDance investors are expected to own around 30%, while a group of new investors will take about 5%. ByteDance itself will retain just under 20% ownership of the US business.

Despite the smaller stake, ByteDance will continue overseeing TikTok’s global operations and managing US e-commerce and advertising strategies.

The deal’s structure may explain its relatively modest valuation. The White House previously said the agreement values TikTok’s US operations at $14 billion.

This is far below the $50 billion estimate cited by Morningstar analysts earlier this year, reflecting that control over revenue-generating businesses is not part of the transfer.