The Trump administration has approached the coalition of American investors set to acquire TikTok's U.S. operations with an unprecedented demand: a multibillion-dollar cash payment to the federal government as a condition of completing the deal. According to sources with direct knowledge of the negotiations, the administration requested a fee in the low billions of dollars, which the investor group has agreed to pay without hesitation, viewing it as a finder's fee for facilitating the transaction.
The investor consortium includes some of the most powerful names in American technology and finance. Oracle, led by Trump ally Larry Ellison, private equity firm Silver Lake, and Abu Dhabi-based investment firm MGX will collectively hold 45 percent of TikTok's U.S. operations, while Chinese parent company ByteDance will retain approximately 20 percent. Additional investors include tech billionaire Michael Dell, the Murdoch family, and prominent venture capital firm Andreessen Horowitz. The deal values TikTok's American business at approximately 14 billion dollars.
The transaction is scheduled to close on January 22, 2026, more than a year after the Protecting Americans from Foreign Adversary Controlled Applications Act went into effect. While the Trump administration has stated that the U.S. government will not take a golden share or equity stake in the new TikTok entity, the multibillion-dollar fee represents a significant government extraction from a private business deal that has drawn sharp criticism from economists and legal experts.
Luigi Zingales, a professor of finance at the University of Chicago Booth School of Business, characterized the arrangement as fundamentally changing how American business operates. He stated that at a minimum, this means there is now a tax imposed on every major business transaction, warning that businesses will no longer focus on innovating and creating value but instead on rent-seeking and ingratiating themselves with the administration. Other experts have called the fee structure extortion and a shakedown scheme with few parallels in modern American history.
The TikTok fee is part of a broader pattern emerging from the White House of extracting financial commitments from private companies. In separate dealings, the federal government has sought an equity stake in Intel and demanded a slice of future profits from chipmakers Nvidia and AMD. Industry insiders say this approach is simply seen as the price of doing business in the current political environment, though historians and economists warn it represents a fundamental shift in the relationship between American government and private enterprise that could have lasting consequences for investment and innovation.