Oracle wins bid to become TikTok's 'trusted technology provider' in US
- Oracle jumped as much as 8% on Monday following reports that the firm won bidding for a partnership with TikTok's US business.
- The news comes after the White House threatened to ban the ByteDance-owned app on data security concerns if it didn't sell its US arm to an American business.
- Microsoft was Oracle's biggest threat in reaching a deal, but the firm said Sunday it won't be joining ByteDance in a partnership.
- The deal is unlikely to involve a sale, The Wall Street Journal reported, though Oracle is expected to take a stake in TikTok.
Oracle confirmed Monday it's agreed to be ByteDance's "trusted technology provider" in the US, and has submitted its proposal the US government for approval.
"Oracle confirms Secretary Mnuchin's statement that it is part of the proposal submitted by ByteDance to the Treasury Department over the weekend in which Oracle will serve as the trusted technology provider," Oracle said in a statement. "Oracle has a 40-year track record providing secure, highly performant technology solutions."
Oracle surged as much as 8% on Monday in reaction to the news.
The news follows an intense race among major tech companies to take the social media giant under their wings. Microsoft, which planned a joint bid with Walmart, presented the biggest threat to Oracle's effort.
Oracle will be deemed TikTok's "trusted tech partner" in the US, The Wall Street Journal reported on Sunday. The deal is unlikely to involve a sale, though Oracle is expected to take a stake in the ByteDance-owned company
Still, the White House and the Committee on Foreign Investment in the US need to approve the deal before it goes through, according to The Journal. The forced sale of TikTok's US business sparked international controversy and reignited political tensions between the US and China. Sources told The Journal they believe the deal satisfies the US government's worries around data security.
President Donald Trump has repeatedly threatened to shut down TikTok's US operations if the company isn't sold to an American firm. The White House set a deadline of September 20 for a sale plan to be announced, with a shutdown deadline looming on September 29. An announced deal would need to be completed by November 12.
Microsoft said in a Sunday blog post it received word from ByteDance that the Chinese tech giant wouldn't pursue a deal.
"We are confident our proposal would have been good for TikTok's users, while protecting national security interests," Microsoft said. "To do this, we would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combatting disinformation, and we made these principles clear in our August statement."
Walmart remains interested in a joint deal. The company said in a Sunday statement that it continues to hold conversations with ByteDance and other interested parties.
Oracle closed at $57 on Friday, up roughly 8% year-to-date.
Receive a daily update on your cellphone with all our latest news: click here.
Get the best of our site emailed to you daily: click here.
Also from Business Insider South Africa: