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TikTok: President Donald Trump wants Treasury to get a cut of the deal

TikTok: President Donald Trump wants Treasury to get a cut of the deal

Bloomberg

TikTok: President Donald Trump wants Treasury to get a cut of the deal

Oracle's closely watched bid for TikTok's US operations will not only have to pass a US national security review, it's also going to need to win the blessing of President Donald Trump.

The US government will undertake a two-track national security review of Oracle's TikTok proposal this week, Treasury Secretary Steven Mnuchin said yesterday.

The deal, if finalised, would create what Mr Mnuchin called "TikTok Global". He added that the unit would have its headquarters and create 20,000 jobs - potentially a move to sweeten the deal as Mr Trump faces what promises to be a hotly contested presidential election in November.

The sale of TikTok - forced by a Trump administration ban on grounds of national security due to TikTok's Chinese ownership - is one of the issues at the heart of the fraying Washington-Beijing relationship. Any deal still requires signoffs from both the US and China.

TikTok confirmed it had submitted Oracle's proposal to the US Treasury, saying it "would resolve the administration's security concerns", according to a spokesperson. Mr Mnuchin said the deadline for a deal, according to Trump's executive order, is September 20.

Mr Trump has also insisted that any sale of the TikTok video app include a cut for the federal government. That demand - which is more akin to a high-stakes real estate deal than a government-ordered divestiture - has baffled policy experts and lawyers who say such a payment would stretch his authority underUS law.

A Treasury spokeswoman declined to comment on whether a deal with Oracle will include the fee that Trump has talked about.

Oracle confirmed in a statement that it is part of the proposal submitted by TikTok's owner ByteDance to the Treasury Department over the weekend in which Oracle will serve as the "trusted technology provider".

Oracle edged out rival Microsoft, which had been working with Walmart, and had been seen as the frontrunner, but those talks had cooled in recent days.

Oracle shares rose 5.76pc to $60.29 (€50.81) in New York.

"We need to make sure that the code is, one, secure, Americans' data is secure, phones are secure, and we'll be looking to have discussions with Oracle over the next few days with our technical team," Mr Mnuchin told CNBC during an interview.

Oracle has nurtured a relationship with Trump since before his administration began. Oracle's Co-founder and Chairman Larry Ellison is one of the few Silicon Valley moguls to openly support Trump, who has called him a "great guy", and voiced support for Oracle's TikTok bid.

Ellison let Mr Trump use one of his California estates to hold a fundraiser in February.

Chief Executive Officer Safra Catz has contributed to Mr Trump's re-election campaign, served on the president's transition team and has dined with him at the White House.

Bloomberg