Beijing (PingWest)- Beijing-based ByteDance is planning to list TikTok on a U.S stock market at certain time after it proposed partnership deal with American-software group Oracle, Reuters reported Thursday, citing people familiar with the matter said.
ByteDance has made commitment to list TikTok in the U.S rather than China or Hong Kong, which is one way to avert the ban in the U.S, the source said.
Under the agreement signed with Oracle, two parties will create a separate corporate entity for TikTok. TikTok parent company ByteDance proposed that it would keep a majorty stake in the new entity and will set up headquarters for TikTok in the United States.
The Trump administration is reviewing the proposals, Trump said on Wednesday that he was opposed to ByteDance retaining majority ownership of TikTok.
In the deal proposed to the U.S government, ByteDance would retain control of the TikTok algorithm, the foundation of the app that recommend the video content to user based on their preference.
The White House and ByteDance have agreed to a term sheet on some aspects of a deal, although Trump has not yet approved it, one of the sources said. Top ByteDance U.S. investors, Oracle Corp and potentially Walmart Inc would hold at least a 60% stake in TikTok’s U.S. operations, Reuter reported, citing a source.
The new entity named TikTok global, will have a majority of American directors, as well as a U.S. Chief executive and a security expert on the board. Oracle has agreed to hold a 20% stake in the company, Walmart’s CEO Doug McMillion would join the board of director of TikTok Global if ByteDance and Walmart reach agreement on the stake acquisition, the source added.
Apart from Doug McMillion, Kevin Systrom, the founder of Instagram, has also emerged as a candidate to run the restructured TikTok.
TikTok IPO would be one of the biggest stock market debuts in technology sector given the fact that app was recently valued at more than USD50 billion.
The deal could come in about a year, the source added.
ByteDance said on Thursday it would need China to approve the proposed deal with the White House.
China also got involved in the TikTok deal last month, revising its export control rules for the technology to regulate the transfer of technology, including TikTok’s foundation-AI-based recommendation algorithm.