{"id":66405,"date":"2020-09-23T02:03:49","date_gmt":"2020-09-23T02:03:49","guid":{"rendered":"https:\/\/www.thefastfashion.com\/?p=66405"},"modified":"2020-09-23T02:03:49","modified_gmt":"2020-09-23T02:03:49","slug":"bytedance-says-will-majority-tiktok-oracle-says-bytedance-will-0-wtf-deal","status":"publish","type":"post","link":"https:\/\/www.thefastfashion.com\/?p=66405","title":{"rendered":"ByteDance says it will own a majority of TikTok. Oracle says ByteDance will own 0%. WTF is this deal?"},"content":{"rendered":"

You know a deal is signed and going to close when the parties keep fact-checking each other and no one can agree on what the deal actually says.<\/p>\n

We\u2019ve been following the\u00a0TikTok\u00a0\/\u00a0Oracle\u00a0deal for some time here on TechCrunch, and over the weekend, it seemed like\u00a0we finally got to the finish line\u00a0of one of the strangest M&A processes we\u2019ve seen. But the last 48 hours have made everything so confused, I am not sure we even know what the deal\u00a0is, despite it being approved.<\/p>\n

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Overnight, my colleague Rita Liao\u00a0put together a nice fact check\u00a0on what we know now about the TikTok deal, based on ByteDance\u2019s official statements. The key is that \u201cChina\u2019s\u00a0ByteDance\u00a0confirms it will retain an 80% stake in TikTok after selling a total of 20% to Oracle, its \u2018trusted technology partner,\u2019 and Walmart, its \u2018commercial partner.\u2019 \u201d<\/p>\n

That\u2019s been our assumption, that Oracle is taking 12.5% in TikTok Global, and Walmart will take 7.5%. The deal terms would value TikTok at\u00a0about $60 billion\u00a0by some estimates.<\/p>\n

That\u2019s a simple story, but apparently not the full one, because now there is another wrinkle happening here.<\/p>\n

In a new statement attributed to its executive vice president Ken Glueck, Oracle said that \u201cUpon creation of TikTok Global, Oracle\/Walmart will make their investment and the TikTok Global shares will be distributed to their owners, Americans will be the majority and ByteDance will have no ownership in TikTok Global.\u201d<\/p>\n\n

President Donald Trump has spoken out about the deal himself in places like CNBC, arguing that TikTok must be completely controlled by Americans.<\/p>\n

From what I can glean (and to be honest, given the shifting landscape and war of words, it\u2019s not clear that even the participants know what is going on), \u201cTikTok\u201d the app is going to be housed in a new company called TikTok Global, which will be located outside of China proper. There appears to be no other \u201cTikTok\u201d entity. ByteDance will continue to own its China-centric apps Douyin (which also is a short video social service targeting the Chinese market),\u00a0Toutiao,\u00a0and others and obviously keep running them.<\/p>\n

So how can a company simultaneously own a majority of the company and 0% of a company? TechCrunch is investigating, or at least, combing through the rubble of this deal and trying to make heads or tails of it.<\/p>\n

Adv<\/em>.<\/strong><\/p>\r\n\r\n