ByteDance is preparing an initial public offering in the US within the next 12 months for a new company that will oversee TikTok’s operations, in a move to appease the Trump administration, the Financial Times reported on Thursday night, citing confidential sources.
Although the exact ownership structure under the proposal made with the US regulator is not yet clear, it is reported that the parent company, as well as software giant Oracle and retailer Walmart could together own a significant stake. Once a public entity, US interests—which would include ByteDance’s American investors, Sequoia Capital, General Atlantic, and Coatue—would own a majority, a feature the Trump administration was pushing for.
The new board of TikTok Global would further only comprise American citizens, Walmart CEO Doug McMillon being one of them, according to the Wall Street Journal. As part of the plan, the board would also have to include a security committee led by a person with government security clearances. ByteDance agreed to allow Oracle to review its source code and software in order to ease safety concerns.
President Trump, who threatened to ban TikTok if it fails to sell its business to an American company before September 15, on Wednesday commented on the proposal currently under the review by the Treasury Department, referring to the fact that the China-based ByteDance will still own the majority: “Conceptually, I don’t like that.”
The deal will also have to satisfy Chinese authorities. While Beijing has asserted its right to block the sale of critical technologies, it is likely to greenlight it as long as it doesn’t involve the transfer of the AI algorithms that drive TikTok’s service, Bloomberg reported.
Meanwhile, TikTok has approached Kevin Systrom, co-founder and former CEO of Instagram, while seeking a CEO to replace Kevin Mayer, who left the company in late August. Vanessa Pappas, the general manager of TikTok in North America, is currently holding the role as interim head.