Oracle wins bidding for TikTok’s US operations after the app rejected Microsoft two days before ban

Computer software company Oracle has won the bidding for TikTok‘s US operations, a source told the Wall Street Journal.  

It comes a week before President Donald Trump promises to follow through with a plan to ban the Chinese-owned app in the US.

A person familiar with the matter told the WSJ that Oracle will be announced TikTok’s ‘trusted tech partner’ in America. They added it is unlikely to be an outright sale. 

ByteDance will need approval for the deal from governments of the United States and China. 

Computer software company Oracle has won the bidding for TikTok ‘s US operations, a source told the Wall Street Journal

It comes a week before President Donald Trump promises to follow through with a plan to ban the Chinese-owned app in the US 

US officials have criticized the app’s security and privacy, suggesting that user data might be shared with Beijing. TikTok has said it would not comply with any request to share user data with the Chinese authorities. 

Oracle will handle TikTok’s US user data, the source added. 

The deal will be structured not as a sale but as a restructuring, the source said, without disclosing how much of TikTok’s US operations ByteDance and its investors will continue to own. 

It was unclear if General Atlantic and Sequoia Capital, both of which were previously reported to have spurred on the Oracle deal, ended up being a part of this agreement.

The Trump administration has threatened to ban TikTok by mid-September and ordered ByteDance to sell its US business, claiming national security risks due to its Chinese ownership. 

Microsoft had said earlier Sunday that its bid to buy the popular video-sharing app had been rejected. 

Microsoft said in a Sunday statement that TikTok’s parent company, Bytedance, ‘let us know today they would not be selling TikTok’s US operations to Microsoft.’

‘We are confident our proposal would have been good for TikTok’s users, while protecting national security interests, ‘the company said in a statement. 

‘To do this, we would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combating disinformation, and we made these principles clear in our August statement. We look forward to seeing how the service evolves in these important areas.’ 

A person familiar with the matter told the WSJ that Oracle will be announced TikTok’s ‘trusted tech partner’ in America

Microsoft said it was ‘confident our proposal would have been good for TikTok’s users, while protecting national security interests.’ 

The company said it ‘would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combating disinformation.’  

It is not clear whether President Trump, who wants a US technology company to own most of TikTok in the United States, and the Committee on Foreign Investment in the US will approve the proposed Oracle deal. 

The government worries about user data being funneled to Chinese authorities. 

TikTok denies it is a national-security risk and is suing to stop the administration from the threatened ban.

Walmart had planned to partner with Microsoft on the deal. 

TikTok didn’t immediately return requests for comment Sunday.

Reuters reported on Friday that Beijing opposes a forced sale of TikTok’s US operations and would prefer to see the short video app shut down in the United States, three people with direct knowledge of the matter said. 

Chinese officials believe a forced sale would make both ByteDance and China appear weak in the face of pressure from Washington, the sources said, speaking on condition of anonymity.

ByteDance said in a statement to Reuters that the Chinese government had never suggested to it that it should shut down TikTok in the United States or in any other markets.

Two of the sources said China was willing to use revisions it made to a technology exports list on August 28 to delay any deal reached by ByteDance, if it had to. 

They revised a list of technologies that would need Chinese government approval before they are exported. Experts said TikTok’s recommendation algorithm would fall under this list. 

Asked on Friday about Trump and TikTok, Chinese foreign ministry spokesman Zhao Lijian said at a regular press briefing that the United States was abusing the concept of national security, and urged it to stop oppressing foreign companies. 

Reuters has reported that TikTok’s prospective buyers were discussing four ways to structure an acquisition from ByteDance.

Within these, ByteDance could still push ahead with a sale of TikTok’s US assets without approval from China’s commerce ministry by selling them without key algorithms.