Beijing, Sep 21 (efe-epa).- Chinese tech company Bytedance announced on Monday that TikTok Global, the new company to be launched with Oracle and Walmart in order to allow it to continue operating in the United States, will launch a public offering of shares to enhance its business structure and transparency.
In a statement, Bytedance said that TikTok Global will conduct a round before the Initial Public Offering (IPO) that will leave the Chinese company with an 80 percent stake in the new firm.
TikTok Global’s board of directors will include Bytedance founder Zhang Yiming and Walmart CEO Doug McMillon as well as the current directors of the Chinese company.
Oracle will have access to TikTok’s source code, although the agreement does not include the transfer of algorithms or other technologies, according to the statement.
Bytedance added that the $5 billion contribution to an education fund that US President Donald Trump has demanded is unrelated to the deal it has reached with Oracle and Walmart.
That amount is based on estimates of the taxes the company will have to pay over the next few years, the statement said.
In a joint statement on Sunday, Walmart and Oracle said that the preliminary deal with Bytedance will create a new company called TikTok Global, in which the two US companies will hold a 20 percent stake.
TikTok Global will provide TikTok services to users in the US and to most of the users in the rest of the world while Oracle will become TikTok’s cloud provider, both companies announced.
The agreement also stipulates that TikTok Global “will be majority owned by American investors, including Oracle and Walmart. TikTok Global will be an independent American company, headquartered in the US, with four Americans out of the five member Board of Directors.”
The US government announced on Saturday that it was postponing by a week the ban on TikTok, which came into effect on Sep. 20, after Trump gave his “blessing” to the preliminary agreement so that it can operate in the country.
Trump said Saturday that he had given “his blessing” to a possible agreement with TikTok by which the Chinese social network would associate with US companies Oracle and Walmart to operate in the US, adding that negotiations continue.
“I have given the deal my blessing. If they get it done, that’s great. If they don’t, that’s okay too. But it’s a great deal for America ,” said the president, who shortly after added that he approved the agreement “in concept.”
Trump said that Oracle and Walmart would partner with TikTok,”the security will be 100 percent. They’ll be using separate clouds and a lot of very, very powerful security.”
“And they’ll be making about a 5-billion-dollar contribution toward education,” he added. EFE-EPA