Abu Dhabi-Backed Group Reaches Deal to Acquire TikTok US, Averting Ban
WASHINGTON – A consortium led by the Abu Dhabi royal family has reached a preliminary agreement with ByteDance to acquire TikTok US, potentially resolving a long-running national security dispute and averting a potential ban of the popular video-sharing app in the United States. The deal, brokered with the support of the Trump governance, aims to address concerns over data security and potential Chinese government influence.
The agreement marks a significant shift in the fate of TikTok US, which has faced intense scrutiny from US lawmakers and officials who fear that ByteDance’s ties to China could compromise the data of millions of American users or be used for propaganda purposes. Under the proposed deal, the Abu dhabi-backed group will take a substantial stake in TikTok US, establishing a new entity self-reliant from ByteDance and operating under US-based management. This structure is intended to ensure user data is securely stored in the United States and is not accessible to the Chinese government.
The $14 billion valuation of TikTok US is considerably lower than the overall valuation of ByteDance, estimated at approximately $330 billion. For comparison, Meta, the parent company of Facebook and Instagram, is valued at $1.8 trillion. The future of TikTok US had been in limbo as April 2024, when Congress passed legislation requiring ByteDance to divest its US operations due to privacy and national security concerns. Former President Trump had previously extended deadlines for a sale or shutdown of TikTok US while attempting to negotiate a resolution.
The deal is still subject to regulatory review and approval from the Committee on Foreign Investment in the United States (CFIUS), but represents a major step towards resolving the standoff. Officials involved in the negotiations expressed confidence that the new ownership structure will address the security concerns that prompted the initial restrictions, allowing TikTok to continue operating in the US while safeguarding the privacy of its users.
