TikTok Might Have A New U.S. Buyer

President Donald Trump said Saturday that he has OK'd "in concept" a deal for Oracle to acquire the U.S. operations of popular video app TikTok. Trump had earlier cited national security concerns in issuing a pair of executive orders that say TikTok will be banned in the states unless such a deal goes through. A ban on U.S. downloads of the app was set to go into effect Sunday.

The Trump administration has said it's concerned about the TikTok app because the app collects data on its U.S. users and TikTok's parent company, ByteDance, a Chinese firm, could be compelled by China's communist government to share that information. TikTok has repeatedly said such concerns are baseless.

On his way to a campaign rally in North Carolina, Trump told reporters that he had given the TikTok-Oracle deal "my blessing". For the deal to be finalized, China's government would have to sign off on it, adding that Chinese officials have indicated that the government is willing to approve an agreement, so long as ByteDance doesn't have to give up the artificial intelligence algorithms behind the TikTok app.

The agreement has Bytedance retaining a majority of TikTok's assets and control over the app's algorithm, and Oracle and other U.S. investors taking minority stakes.

Oracle will get full access to review TikTok's source code and updates to make sure there are no back doors used by the company's Chinese parent to gather data or to spy on the video-sharing app's 100 million American users.

Last Friday, Trump told Oracle Chairman Larry Ellison that he still expects the U.S. government to get a cash payment as part of the sale, adding that it's unclear how that would come about.

A TikTok spokesperson said in a statement that TikTok is pleased the deal "will resolve the security concerns of the U.S. Administration and settle questions around TikTok's future in the US."

"As part of this proposal, Oracle will become our trusted technology provider, responsible for hosting all U.S. user data and securing associated computer systems to ensure U.S. national security requirements are fully satisfied," the spokesperson said. "We are currently working with Walmart on a commercial partnership as well. Both companies will take part in a TikTok Global pre-IPO financing round in which they can take up to a 20% cumulative stake in the company. We will also maintain and expand TikTok Global's headquarters in the U.S., while bringing 25,000 jobs across the country."

Oracle CEO Safra Catz said in a statement that Oracle "will quickly deploy, rapidly scale, and operate TikTok systems in the Oracle Cloud. We are a hundred percent confident in our ability to deliver a highly secure environment to TikTok and ensure data privacy to TikTok's American users, and users throughout the world. This greatly improved security and guaranteed privacy will enable the continued rapid growth of the TikTok user community to benefit all stakeholders."