The White House is close to finalizing a deal that would transfer control of TikTok’s U.S. operations from its Chinese parent company, Bytedance, to American investors. This move aims to address security concerns raised by the U.S. government. According to a report by the Financial Times, U.S. officials under President Donald Trump’s administration are scheduled to meet on Thursday (IST) to discuss the ownership transition. If Trump approves the deal, an official announcement could follow soon. This development comes shortly after tech giant Amazon submitted a last-minute bid to acquire TikTok’s U.S. operations.

With the April 5 deadline looming, TikTok is required to secure a non-Chinese buyer or face a ban in the U.S. The report indicates that private equity firms like Andreessen Horowitz and Blackstone are expected to acquire half of TikTok’s U.S. business. Existing investors, including General Atlantic, Susquehanna, KKR, and Coatue, will hold approximately 30% of the company.

Any transaction will need approval from President Trump, Bytedance, and the Chinese government, which has previously threatened to block such a sale. Under U.S. legislation, no more than 20% of the company can remain under the control of a “foreign adversary,” meaning Bytedance would retain only a minority stake. Additionally, Oracle, co-founded by Larry Ellison, is expected to manage TikTok’s U.S. data as part of the agreement.

Debate Over TikTok’s Algorithm: A key unresolved issue is control over TikTok’s proprietary algorithm, which is central to the app’s success. While China insists that Bytedance should continue managing it, U.S. laws may require that a domestic entity take full control. This remains a crucial point in negotiations. Despite Amazon’s last-minute entry into the bidding process, reports suggest that existing investors remain the frontrunners. Another bidder is Zoop, a startup founded by Tim Stokely, creator of OnlyFans, which has partnered with a cryptocurrency foundation in its bid.

The Background of the Controversy: The dispute over TikTok’s U.S. operations began when former President Joe Biden signed a bipartisan law mandating that the company either sell its U.S. division to an American entity or face a nationwide ban over security concerns. Bytedance responded by filing a lawsuit against the U.S. government, arguing that the law violated the First Amendment. During his election campaign, Trump, who was a leading candidate at the time, joined TikTok to engage with voters. After winning the presidency, he requested the Supreme Court to halt the ban and later paused it upon taking office on January 20, allowing TikTok time to finalize a deal before the April 5 deadline.

Disclaimer: This image is taken from Bloomberg.