China Blocks Meta’s Ambitious $2 Billion Bid for Manus AI Startup
In a striking move that reverberates across the tech industry, China’s National Development and Reform Commission (NDRC) announced on Monday its decision to thwart Meta’s plans to acquire Manus, an innovative AI startup founded by Chinese engineers now based in Singapore. This acquisition, valued at approximately $2 billion, was initially unveiled late last year by Mark Zuckerberg’s tech giant.
This intervention marks a significant example of China’s regulatory clout in international business, reflecting growing concerns that extend beyond the typical U.S.-China tensions and delve into the intricate world of artificial intelligence. For Meta, this setback poses a significant hurdle in its quest to become a leader in the rapidly evolving AI landscape.
Interestingly, the NDRC did not provide specific reasons for its decision, instead mandating that both parties rescind the acquisition entirely. They stated, “The National Development and Reform Commission (NDRC) has made a decision to prohibit foreign investment in the Manus project in accordance with laws and regulations, and has required the parties involved to withdraw the acquisition transaction.”
Despite this ultimatum, the narrative surrounding Manus is far from simple. Approximately 100 Manus employees are already working at Meta’s Singapore office as of March, with some of the startup’s founders transitioning into key executive positions within the company. Manus CEO Xiao Hong now reports directly to Meta COO Javier Olivan, signaling a deeper integration than the acquisition’s blockade might suggest. However, troubling circumstances remain, as reports indicate that Hong and Chief Scientist Yichao Ji are currently under exit bans, preventing them from leaving mainland China.
Meta’s representatives have expressed optimism regarding the situation, asserting, “The transaction complied fully with applicable law. We anticipate an appropriate resolution to the inquiry.”
Manus was founded in 2022 by Hong, Ji, and Tao Zhang, who initially established their operations in Beijing before relocating to Singapore mid-2025. Meta’s acquisition announcement followed just months later, with aspirations to weave Manus’ advanced agent technology into its own AI initiatives.
While Meta’s acquisition was positioned as a means to sever ties with its Chinese roots, the origins of Manus remain closely entwined with China. Its founders previously established the parent company, Butterfly Effect, in Beijing. These connections have introduced scrutiny from U.S. lawmakers, including Senator John Cornyn, who questioned the implications of American investment flowing into a firm with Chinese affiliations.
As this intricate saga unfolds, the responses from both Manus and Meta to queries remain elusive, leaving many to speculate about the future of international tech ventures amid stringent regulatory landscapes.
Stay tuned as this story develops, shedding light on the complex dynamics of technology, investment, and the ever-shifting regulatory environments in today’s global marketplace.