Private equity firm Blackstone is considering a small minority investment in U.S. operations. The firm is in discussions to join ByteDance's existing non-Chinese shareholders, led by Susquehanna International Group and General Atlantic, in providing fresh capital to bid for TikTok's U.S. business.
Their proposal involves spinning off TikTok's U.S. operations into a separate entity and reducing Chinese ownership in the new company to below the 20% threshold required by U.S. law.
The future of TikTok, used by nearly half of all Americans, remains uncertain after a law passed last year with strong bipartisan support required ByteDance to divest TikTok by January 19 or face action on national security grounds.
After the Supreme Court upheld the ban in January, TikTok's U.S. operations were briefly halted, only to resume shortly after the new administration postponed enforcement of the law until April 5.
Former President Trump suggested further negotiations, which may include reducing tariffs on China to facilitate a deal. U.S. Vice President JD Vance expressed optimism that an agreement regarding the ownership of the app could be reached by the April deadline.
ByteDance and its investors have not disclosed the amount of new investment needed to buy out Chinese shareholders and comply with U.S. regulations.
Legal filings from TikTok last year indicated that global investors own approximately 58% of ByteDance, while the company's Chinese founder Zhang Yiming controls 21%, and employees of various nationalities, including around 7,000 Americans, own the remaining 21%.
The White House has been actively involved in the negotiations, essentially taking on the role of an investment bank. Reports in January indicated that the Trump administration was exploring a deal that would involve Oracle and some existing ByteDance investors taking operational control of the app.