Investors in a deal to create a U.S.-controlled TikTok are set to pay a $10 billion transaction fee to the U.S. Treasury for the government's role in facilitating the agreement. The fee, which is about 70% of TikTok's reported $14 billion valuation, is being paid by new investors including Oracle, MGX, and Silver Lake to resolve national security concerns over its previous Chinese ownership.
The Trump administration played an active and untraditional role in the deal, with President Trump appointing Vice President JD Vance to lead it. The arrangement is part of a broader pattern of the administration inserting the federal government into corporate dealmaking, including taking equity stakes in companies.
As part of the deal, ByteDance's ownership stake in the U.S. arm was reduced to under 20%. Some of the new investors have ties to the administration, and critics have called the unprecedented fee "outrageously large."
Main Topics: U.S.-TikTok deal and $10 billion transaction fee, Trump administration's role in corporate deals, national security concerns over Chinese ownership, investor details and structure of the agreement.
Investors in a deal to create a U.S.-controlled TikTok are set to pay $10 billion to the U.S. Treasury, the latest example of the Trump administration inserting the federal government into corporate dealmaking in unusual ways.
The fee, which the U.S. government is considering a transaction fee for its role in helping bring about the deal, will be paid by new investors in the U.S. TikTok, according to two people briefed on the matter who were not authorized to speak publicly about the transaction.
The new investors paid the Treasury roughly $2.5 billion of the fee when the deal closed in January. They plan to pay the rest of the fee in an additional set of payments, one of the people said. The investors include software giant Oracle; MGX, an Emirati investment firm; and Silver Lake, another investment firm, which each own about 15% of the company.
TikTok struck a deal with the investors in January to address years of legal uncertainty about the video app, owned by Chinese internet company ByteDance, after bipartisan concern that its ownership could pose a national security threat.
The White House has played an active and untraditional role in the deal from the outset. President Donald Trump appointed Vice President JD Vance to lead the transaction last year. In September, Trump said the U.S. would receive a "tremendous fee" for putting the deal together. "I call it a fee plus for just making the deal," he said.
The Wall Street Journal earlier reported that the transaction fee was set to be $10 billion.
A spokesperson for Vance declined to comment. The Treasury did not respond to requests for comment.
Aaron Bartnick, a former White House assistant director for technology security and governance under the Biden administration, said the $10 billion might be unprecedented and was "outrageously large."
During his second term, Trump has aggressively involved himself in private sector dealmaking. The government has taken equity stakes in several companies, including a 10% stake in Intel. As part of a deal to clear national security concerns surrounding the sale of U.S. Steel to Nippon Steel last year, the administration demanded what it called a "Golden Share."
Vance has said the deal will value TikTok at $14 billion. That would mean the transaction fee is about 70% of the company's worth.
As part of the deal, ByteDance separated its U.S. arm into another company and brought in new investors, which reduced ByteDance's ownership stake to just under 20%.
Additional new investors include the personal investment entity for Michael Dell, the tech billionaire behind Dell Technologies, and an affiliate of the global trading firm Susquehanna.
Some of the new investors have ties to the administration. Larry Ellison, a co-founder of Oracle, is friendly with Trump and is backing the acquisition of Warner Bros. Discovery by his son, David Ellison, the CEO of Paramount. MGX has done business with the Trump family's cryptocurrency firm, World Liberty Financial.
Spokespeople for Oracle, MGX and Silver Lake either declined to comment or did not respond to a request for comment.
The fee, which the U.S. government is considering a transaction fee for its role in helping bring about the deal, will be paid by new investors in the U.S. TikTok, according to two people briefed on the matter who were not authorized to speak publicly about the transaction.
The new investors paid the Treasury roughly $2.5 billion of the fee when the deal closed in January. They plan to pay the rest of the fee in an additional set of payments, one of the people said. The investors include software giant Oracle; MGX, an Emirati investment firm; and Silver Lake, another investment firm, which each own about 15% of the company.
TikTok struck a deal with the investors in January to address years of legal uncertainty about the video app, owned by Chinese internet company ByteDance, after bipartisan concern that its ownership could pose a national security threat.
The White House has played an active and untraditional role in the deal from the outset. President Donald Trump appointed Vice President JD Vance to lead the transaction last year. In September, Trump said the U.S. would receive a "tremendous fee" for putting the deal together. "I call it a fee plus for just making the deal," he said.
The Wall Street Journal earlier reported that the transaction fee was set to be $10 billion.
A spokesperson for Vance declined to comment. The Treasury did not respond to requests for comment.
Aaron Bartnick, a former White House assistant director for technology security and governance under the Biden administration, said the $10 billion might be unprecedented and was "outrageously large."
During his second term, Trump has aggressively involved himself in private sector dealmaking. The government has taken equity stakes in several companies, including a 10% stake in Intel. As part of a deal to clear national security concerns surrounding the sale of U.S. Steel to Nippon Steel last year, the administration demanded what it called a "Golden Share."
Vance has said the deal will value TikTok at $14 billion. That would mean the transaction fee is about 70% of the company's worth.
As part of the deal, ByteDance separated its U.S. arm into another company and brought in new investors, which reduced ByteDance's ownership stake to just under 20%.
Additional new investors include the personal investment entity for Michael Dell, the tech billionaire behind Dell Technologies, and an affiliate of the global trading firm Susquehanna.
Some of the new investors have ties to the administration. Larry Ellison, a co-founder of Oracle, is friendly with Trump and is backing the acquisition of Warner Bros. Discovery by his son, David Ellison, the CEO of Paramount. MGX has done business with the Trump family's cryptocurrency firm, World Liberty Financial.
Spokespeople for Oracle, MGX and Silver Lake either declined to comment or did not respond to a request for comment.
Meridiano
