ByteDance to Own 80% of TikTok Global

ByteDance announced this week that it will have a majority 80% stake in the new U.S.-based TikTok company, refuting the claim from Trump that the deal would have “nothing to do with China.”

The company also said that it plans to carry out a small round of pre-IPO financing that will give ByteDance an 80% stake in TikTok Global. Oracle and Walmart will also have minority stakes in the company.

As part of the deal, Oracle, Walmart and ByteDance agreed to list TikTok Global on an American stock exchange within 12 months.

This past weekend President Trump was in agreement to a deal that would have Oracle and Walmart take minority stakes in TikTok Global.

“It’ll be a brand new company. It will have nothing to do with any outside land, any outside country, it will have nothing to do with China,” Trump said.

In early August, Trump said that TikTok would be shut down in the U.S. unless an American firm bought it.
“So it’ll close down on Sept. 15 unless Microsoft or somebody else is able to buy it and work out a deal, an appropriate deal, so that the Treasury of the United States gets a lot of money,” Trump had said.

U.S. Secretary of State Mike Pompeo said the entity will be “controlled by Americans” in an interview with Fox News’ “Sunday Morning Futures.” He had said that ByteDance would just be a “passive shareholder.”

“I used to do oil deals all the time. I didn’t have any access to the company’s information. I just got a royalty check, right? That’s the situation — just a passive shareholder who collects money and/or writes a check if the company is not doing well. No access to the company, no decision-making authority, to ability to peer into what they’re doing; just a passive shareholder,” Pompeo said.

ByteDance explained that this is just a “forecast” of corporate taxes and other taxes that TikTok Global will need to pay for business development over the next few years. The tax will need to be determined according to how TikTok Global develops, noting that the $5 billion figure has “nothing to do” with deal with Oracle and Walmart.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.