The administration of US President Donald Trump is expected to receive a multi-billion dollar commission from investors as part of a complex deal to control TikTok's US operations. This deal will be the latest in a series of lucrative agreements between the US government and the private sector, The Wall Street Journal reports, according to UNN.
Details
Investors involved in the TikTok deal will pay the US government a commission in exchange for negotiations with China, sources familiar with the situation said. President Trump and Chinese leader Xi Jinping approved the preliminary framework of the deal on Friday.
The final structure and size of the payment have not yet been agreed upon, as negotiations on the transaction are ongoing, but, according to sources, the total amount could be billions of dollars. Recently, the US government agreed to become the largest shareholder of Intel and receive 15% of the sales of Nvidia's artificial intelligence chip produced for the Chinese market in exchange for export licenses.
Nvidia and AMD to give US 15% of chip sales profit in China - report11.08.25, 08:19 • [views_3644]
Trump mentioned that the federal government could receive a commission as part of the TikTok deal, but did not specify that it could be billions of dollars – a huge amount for organizing the deal.
"It's not fully agreed upon yet, but we're going to get something," Trump said Friday in the Oval Office, adding that the size of the deal, as well as the government's investment and effort, justify the compensation. A day earlier, he said: "The United States is getting a huge commission – I call it a commission – just for making the deal, and I don't want to neglect that."
Investment bankers advising on typical deals receive a commission of less than 1% of the deal amount, and this percentage typically decreases as the deal size increases. TikTok's US operations could be worth many billions of dollars depending on the final outcome of the deal. However, a multi-billion dollar commission would be unprecedented.
The geopolitical component of the TikTok deal makes it an exception to the rules, and this is the argument Trump uses to justify transferring part of Nvidia's chip sales to China.
Traditionally, companies do not pay the government for national security-related permits or export licenses, and some lawyers consider such agreements illegal.
The unusual TikTok commission scheme is part of already complex negotiations. Last year, the US Congress passed a law banning the video streaming app in the US due to concerns that China could access US user data. Trump, at the beginning of his second term, intervened and promised to negotiate the transfer of control of the company from TikTok's parent company, ByteDance, to American investors.
The deal will end years of uncertainty about TikTok's fate in America, which dates back to the early days of Trump's presidency.
Under the structure being discussed, a group of new investors, including private equity firm Silver Lake and cloud computing company Oracle, will own approximately half of the new American company operating TikTok in America. Existing investors will own about 30%, while ByteDance's stake will fall slightly below 20% in accordance with the law.
"The TikTok deal is in full swing," Trump said Friday afternoon in the Oval Office.
Addition
Trump, the publication notes, has taken a number of steps to strengthen his influence over the private sector during his second term, raising concerns among some Republicans who fear his repeated interventions. Trump administration officials are considering a plan to stimulate the construction of factories and other infrastructure using billions of dollars from a fund created during trade negotiations with Japan, the publication writes.
The American government also received a "golden share" during Nippon Steel's acquisition of U.S. Steel, which gives Trump the right to appoint a member of Nippon Steel's board of directors. His approval is required for many of the company's strategic decisions.