The United States is expected to collect roughly $10 billion in fees from investors involved in the recent sale of the American operations of TikTok, according to Bloomberg, citing reporting from the Wall Street Journal. The payment is tied to the agreement under which China-based ByteDance Ltd. transferred control of the popular video-sharing app’s US business to a consortium of American investors.
Per Bloomberg, the deal was structured after US lawmakers passed legislation requiring TikTok to either cease operations domestically or sell its US unit to American owners at the start of President Donald Trump’s second term. Facing the prospect of a shutdown, ByteDance moved forward with a divestiture after the White House extended the deadline through a series of executive actions that allowed negotiations to continue.
The buyer group includes major US investors led by Oracle Corp. and private equity firm Silver Lake Management LLC, according to Bloomberg. The administration played a role in facilitating discussions that ultimately led to the agreement, which establishes a new corporate structure overseeing TikTok’s operations within the United States.
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Under the arrangement, the US government is set to receive the estimated $10 billion fee from investors participating in the transaction, according to Bloomberg. The White House did not immediately respond to requests for comment about the payment, though President Trump had previously suggested that the government would receive compensation related to the deal.
Related: Lawsuit Challenges US Approval of TikTok Joint Venture Deal
“The United States is getting a tremendous fee-plus — I call it a fee-plus — just for making the deal and I don’t want to throw that out the window,” Trump said in September.
Per Bloomberg, the newly created entity overseeing the platform in the US will operate under the name TikTok USDS Joint Venture LLC. The company will be responsible for managing content moderation and safeguarding the personal data of American users.
The governance structure for the venture includes a seven-member board with a majority of American representatives, according to Bloomberg. TikTok Chief Executive Officer Shou Chew will retain a seat on the board while continuing to lead ByteDance’s global operations.
Adam Presser, previously TikTok’s head of operations as well as trust and safety, has been appointed chief executive officer of the new US venture, according to Bloomberg. The arrangement is intended to address long-standing concerns among US policymakers about data security and foreign ownership while allowing the widely used app to continue operating in the American market.
Source: Bloomberg