Meta deal blocked by China
- China’s top planner ordered Meta and Manus to withdraw their $2 billion-plus deal on April 27, blocking the U.S. company’s acquisition of the AI startup. - Manus moved from China to Singapore after Benchmark led a $75 million round, but Beijing still asserted jurisdiction over the company’s founders and technology. - The order broadens China’s reach over offshore AI restructurings and cross-border tech sales. (reuters.com)
China ordered Meta to unwind its $2 billion-plus acquisition of Manus on April 27, halting a deal the company had announced in December. (reuters.com) China’s National Development and Reform Commission said it would prohibit foreign investment in the Manus project and required the parties to withdraw the transaction. The agency did not name Meta in its statement, but Reuters, CNBC and other outlets identified Meta as the buyer. (reuters.com) (cnbc.com) Meta announced the acquisition in late December 2025. Reuters reported the Singapore-based company was valued at between $2 billion and $3 billion, while CNBC described the transaction as a $2 billion takeover. (reuters.com) (cnbc.com) Manus builds general-purpose AI agents, software that carries out multistep tasks such as coding, market research and data analysis with limited human prompting. CNBC reported Manus said it crossed $100 million in annual recurring revenue in December 2025, eight months after launch. (cnbc.com) The fight over the deal turned on where Manus was really based. Reuters reported its parent, Butterfly Effect, shut China offices in July 2025, laid off dozens of employees and re-incorporated in Singapore after a $75 million fundraising round led by Benchmark. (reuters.com) That move was meant to sidestep two sets of rules at once: U.S. limits on direct American investment in Chinese AI companies and Chinese restrictions on sending intellectual property and capital overseas. CNBC said founders and investors had treated that structure as a “Singapore-washing” model. (reuters.com) (cnbc.com) Beijing began probing the transaction in January through the commerce ministry, which said companies involved in foreign investment, technology exports, data transfers abroad and acquisitions had to comply with Chinese law. Meta said in March that the transaction “complied fully with applicable law.” (cnbc.com) (reuters.com) TechCrunch reported that about 100 Manus employees had already moved into Meta’s Singapore offices by March, and that Manus chief executive Xiao Hong was reporting to Meta chief operating officer Javier Olivan. TechCrunch also reported Hong and chief scientist Ji Yichao were under exit bans in mainland China. (techcrunch.com) Reuters reported lawyers and analysts saw the order as a rare attempt to unwind a completed cross-border deal involving a Singapore entity because the founders, assets or technology still touched China. Wilson Sonsini partner Weiheng Chen told Reuters that Chinese national-security clearance would become “a regular closing condition” for cross-border tech deals. (reuters.com) The immediate next step is reversal, not integration. Reuters reported on April 27 that Meta was preparing to unwind the acquisition after the Chinese order. (reuters.com)
