Trump Administration Set to Receive Approximately Rp169 Trillion from TikTok US Deal
The Trump administration is reported to receive approximately US10billion(aroundRp169trillion, basedonanexchangerateassumptionofRp16, 919/US) from an agreement on the takeover of TikTok’s business operations in the United States.
According to The Wall Street Journal, the payment is part of an agreement in which several investors close to the Trump administration take over TikTok’s operations in America from its Chinese parent company, ByteDance.
The transaction also includes additional investment to establish a new entity that will manage TikTok in the US.
Some of the investors involved in the agreement include cloud-computing company Oracle, private equity firm Silver Lake, and Abu Dhabi-based investor MGX.
These investors, together with a number of other backers, have already paid approximately US$2.5 billion to the US Treasury Department when the agreement was finalised in January. Further payments will be made in instalments until reaching US$10 billion according to The Wall Street Journal sources.
When announcing the TikTok deal framework in September, Trump stated: “This is not fully negotiated yet, but we will get something.” Trump added that the scale of the deal as well as the money and effort expended by the government justified the compensation. He previously stated: “The United States is getting a very large fee. I call it a fee-plus, just to make this deal happen and I do not want to waste it.”
The US$10 billion payment is reportedly nearly unprecedented for a government helping to arrange a transaction, according to historians.
US Vice President JD Vance previously stated that the new TikTok entity running US operations is valued at around US$14 billion in the agreement, which according to some technology analysts significantly undervalues the company.
As part of the agreement, the US entity must share profits with ByteDance, which licenses its popular algorithm to the new venture so that it can be fully trained on American citizens and still retains nearly 20 per cent ownership.