ByteDance Insists it Will Retain Majority Stake in TikTok After Oracle Deal

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China’s ByteDance said Monday that it would retain control of video-sharing application TikTok under a proposed deal for Oracle and Walmart to operate an American subsidiary.

“In order to ensure that 100 million American users can continue to use TikTok, meet the regulatory requirements of the U.S. government, and strengthen TikTok’s U.S. business, Bytedance, Oracle, and Walmart have formed a principled consensus on TikTok’s cooperation,” ByteDance said. “The three parties will advance negotiations in accordance with the relevant consensus and hope to reach a cooperation agreement that meets the legal requirements of the United States and China as soon as possible.”

Bytedance added that the new company would be its “100 [percent] owned subsidiary,” but that its ownership would drop to 80 percent after a “small round” of financing.

The statement seemingly contradicted assertions by Oracle and Walmart over the weekend. “TikTok Global will be majority owned by American investors, including Oracle and Walmart,” the companies said Saturday. “TikTok Global will be an independent American company, headquartered in the U.S., with four Americans out of the five member board of directors.”

In a statement on WeChat — another Chinese company fighting President Donald Trump’s executive order — ByteDance attempted to dispel Chinese rumors about the deal. Responding to the idea that “Oracle may use and possess the source code of TikTok,” ByteDance reassured Chinese users the plan “does not involve the transfer of any algorithms and technologies.”

“Oracle has the authority to check the source code of TikTok USA,” the company added. “Displaying the source code is a universal solution for multinational companies to face local data security concerns.”

The Trump administration delayed its ban on downloading TikTok until September 27 after previously announcing that the ban would be in place on September 20. That delay was introduced after Trump expressed tentative approval of TikTok’s deal with Oracle and Walmart.

Oracle will reportedly hold a 12.5 percent stake in a new company, TikTok Global, under the terms of the proposed deal. Walmart would have a 7.5 percent stake. That company would be headquartered in the United States, while four of its five board members would be American.