Kamal Ghorui
The US government is expected to receive about $10 billion as part of a deal involving TikTok’s operations in the country. A report notes that analysts have claimed the payment as unusual for a government’s role in brokering such a transaction. The fee is tied to an agreement under which investors aligned with the Trump administration will take control of TikTok’s US business from its Chinese parent, ByteDance. The payment comes in addition to investments made to establish a new entity to operate TikTok in the US. This arrangement allows the app to continue operating in the country while shifting ownership of its US business.According to a Wall Street Journal report, historians have described the $10 billion payment as “nearly unprecedented” for a government facilitating a corporate deal. The investors in TikTok’s US unit include Oracle, private equity firm Silver Lake and Abu Dhabi-based investor MGX. The WSJ report cited people familiar with the matter to claim that they and other backers have already paid the US Treasury Department about $2.5 billion when the deal closed in January and are expected to make additional payments until the total reaches $10 billion.As part of the agreement, the US entity will share profits with ByteDance, which licensed its algorithm to the new venture so it can be trained on American users and continues to hold nearly 20% ownership. Earlier, US Vice President JD Vance said that the new TikTok entity is valued at around $14 billion, though some analysts have argued that this figure may undervalue the business, the report notes.To compare, investment bankers advising on transactions typically receive fees of less than 1% of the deal value, with the percentage usually decreasing as deal size increases, the WSJ report claimed. For example, Bank of America is expected to earn about $130 million in advisory fees for advising Norfolk Southern on its $71.5 billion sale to Union Pacific, one of the biggest advisory fees recorded for a single bank.
What Trump administration said about $10 billion TikTok US deal fee
Officials from the Trump Administration told WSJ that the fee is justified by US President Donald Trump’s role in keeping TikTok operational in the country and in handling negotiations with China, while addressing lawmakers’ concerns.When outlining the framework for the deal in September 2025, Trump said, “It hasn’t been fully negotiated, but we’ll get something,” adding that the scale of the deal and the government’s involvement support the case for compensation. Earlier, he had said, “The United States is getting a tremendous fee-plus—I call it a fee-plus—just for making the deal, and I don’t want to throw that out the window.”The agreement was structured to comply with a law requiring TikTok’s US operations to reduce their ownership by their parent company, ByteDance, or to stop operating in the country. Lawmakers had raised concerns about potential security risks linked to a Chinese company managing an app that handles large amounts of user data in the US, an issue that dates back to Trump’s first term.The fee tied to the TikTok deal is part of a broader pattern of transactions involving major companies. The administration has taken steps such as acquiring a nearly 10% stake in Intel and reaching an arrangement with Nvidia to receive a share of chip sales to China in exchange for export licences. It has also taken equity stakes in other businesses and secured influence over US Steel’s operations through a “golden share” agreement with Nippon Steel as part of its acquisition.
