(Bloomberg) -- China’s ByteDance Ltd. is seeking a valuation of $60 billion for TikTok as Oracle Corp. and Walmart Inc. take stakes in the short-video app’s business to address U.S. security concerns, according to a person familiar with the matter.Oracle and Walmart have rights to buy 12.5% and 7.5% respectively of a newly established TikTok Global under an agreement that won the approval of President Donald Trump, the person said, asking not to be named discussing private negotiations. The two companies would pay a combined $12 billion for their stakes if they agree to that asking price.The final valuation had not been set as the parties worked out the equity structure and measures for data security, the person said. Terms are still in flux and the proposed valuation could still change. Beijing also has yet to approve the deal, though regulators are said to favor any transaction in which ByteDance maintains control of its valuable recommendation algorithms and other proprietary technology.ByteDance was pressured into a deal for TikTok when Trump threatened to ban the app in the U.S. over national security concerns. After Microsoft Corp. made a proposal for a full buyout of the service, ByteDance instead turned to Oracle’s offering in which the Chinese parent will maintain a solid majority stake.“I approved the deal in concept,” Trump told reporters Saturday as he left the White House for a campaign rally in Fayetteville, North Carolina. “If they get it done, that’s great. If they don’t, that’s OK too.”ByteDance and Oracle representatives didn’t respond to requests for comment.TikTok has emerged as a top target in Trump’s effort to crack down on China ahead of the November U.S. elections. Tensions between Washington and Beijing are escalating as the Trump administration wages a campaign to contain the country’s technology ascendancy that’s also ensnared Tencent Holdings Ltd., whose WeChat social media app faces a ban in the U.S.”This is part of the broader technology decoupling of our two countries, “ said Melissa Hathaway, president of Hathaway Global Strategies and an advisor to the Obama and Bush administrations. “We’re using our different rules or policies or authorities within our countries to drive that wedge, and forcing choices between our companies and its overall customer base, unfortunately.”The valuation for TikTok has been a looming question as Washington and Beijing clashed over the negotiations. The service for the U.S. market alone has been estimated to be worth $20 billion to $50 billion, or even more. Snap Inc., for context, trades at a $35 billion valuation.ByteDance, the Beijing-based parent company, is the most valuable private startup in the world at $140 billion, according to market researcher CB Insights. The TikTok Global deal does not include the app’s China twin, Douyin, which has become an enormous hit in its own right.ByteDance may end up owning as much as 80% of TikTok Global, which would include the app’s operations in the U.S. and the rest of the world excluding China. Venture firms, including Sequoia Capital and General Atlantic, may also acquire equity in the new business.Under the current proposal, there will be five seats on the board of TikTok Global. Walmart Chief Executive Officer Doug McMillon will become a director, the retailer said in a statement. TikTok Global will likely be headquartered in Texas and will hire “at least” 25,000 people, Trump said. It will need to hire thousands of content moderators, engineers, and marketing staff that were previously located in China and around the world.TikTok Global intends to hold an initial public offering within 12 months, Oracle and Walmart said. And Trump said Saturday he wants $5 billion from companies creating the new TikTok venture for an education fund that would teach American children “the real history of our country.”TikTok plans to use proceeds from its IPO for the $5 billion grant, a person familiar with the matter said. ByteDance first heard about education fund payment from news reports, a company spokeswoman said.Oracle will get full access to review TikTok’s source code and updates to make sure there are no back doors used by the company’s Chinese parent to gather data or to spy on the video-sharing app’s 100 million American users, according to people familiar with the matter. The U.S. software giant has given reassurances it can protect TikTok user data from foreign influence.“Oracle will quickly deploy, rapidly scale, and operate TikTok systems in the Oracle Cloud,” CEO Safra Catz said in a statement. “We are a 100% confident in our ability to deliver a highly secure environment to TikTok and ensure data privacy to TikTok’s American users.”(Updates with details of $5 billion payment in 12th paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.