U.S. Treasury Secretary Scott Bessent confirms the TikTok deal announced last month will be finalized when U.S. President Donald Trump meets with Chinese President Xi Jinping at the Asia Pacific Economic Cooperation summit (scheduled Oct. 31 to Nov. 1) in South Korea.

“We reached a final deal on TikTok. We reached one in Madrid and I believe that, as of today, all the details are ironed out,” Bessent said on “Face the Nation with Margaret Brennan.”

While the agreement establishes a U.S.-based “joint venture” with majority American ownership and board control, ByteDance appears positioned to retain substantial economic benefits. According to sources familiar with the arrangement, the Beijing-based company may receive approximately half of TikTok’s U.S. profits despite selling majority ownership.

ByteDance plans to maintain its revenue through two mechanisms: a licensing fee for its algorithm technology estimated at about 20% of incremental revenue, and a profit share proportional to its remaining equity stake, which could be up to 20% of the new entity.

Investor Consortium Takes Majority Control

The White House previously outlined that a consortium of American investors, including Oracle, will hold a stake in the new TikTok. ByteDance and its affiliates will own less than 20% of the new entity, with the board of directors having a majority of Americans.

This arrangement satisfies the “qualified divestiture” requirement under the bipartisan law passed in April 2024 that required TikTok’s China-based parent company to divest or face a ban in the United States.

Valuation and Security Concerns

The profit-sharing structure may explain the valuation discrepancy between analyst projections of $35 billion to $40 billion and Vice President JD Vance’s cited price tag of $14 billion for the U.S. business.

Republican Rep. John Moolenaar, Chairman of the House China Committee, maintains reservations about the deal. “As long as the Chinese are involved, I think there’s reason for distrust,” Moolenaar said, adding that “the Chinese report to the Chinese Communist Party, and they will leverage every advantage they get.”

The deal represents Trump’s effort to balance national security concerns with keeping the popular platform available to American users. Bessent noted his role was “to get the Chinese to agree to approve the transaction,” which he believes was “successfully accomplished” over the past two days during Trump’s Asia visit.

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