China orders Meta to unwind $2B Manus acquisition

China’s National Development and Reform Commission ordered Meta to unwind its roughly $2 billion acquisition of AI startup Manus, saying it will “prohibit foreign investment in Manus in accordance with laws and regulations, and requires the parties involved to withdraw the acquisition transaction.” The agency’s order requires both companies to reverse the transaction and blocks foreign control of the firm.

Meta announced the planned purchase in late December 2025. China’s commerce authorities opened a review of the deal in January 2026, and regulatory scrutiny intensified in the following months. Manus co‑founders Xiao Hong and Ji Yichao were summoned to Beijing for meetings with officials and were later barred from leaving China during the review. Manus had begun winding down its China operations in mid‑2025, closed offices and cut staff in July 2025, and relocated most employees to Singapore.

Manus develops autonomous AI agents that plan and execute tasks without human direction. The startup raised $75 million in May 2025 and reported about $100 million in annual recurring revenue by December 2025, eight months after launching. By March 2026 roughly 100 Manus staff were working from Meta’s Singapore offices as parts of integration had already started.

Meta has been reallocating resources toward artificial intelligence. Earlier in 2026 the company announced plans to cut about 8,000 jobs and leave 6,000 open positions unfilled to free funds for AI work. The company has indicated it will invest heavily in external AI infrastructure, including large cloud and chip purchases.

The NDRC oversees economic planning and national AI policy in China. The intervention follows a pattern of closer review of transactions involving advanced computing and AI capabilities and arrives as governments globally tighten scrutiny of cross‑border technology deals that involve sensitive data, compute or industrial policy.

Companies involved have begun reversing integration steps taken after the acquisition announcement. Manus employees who moved into Meta’s Singapore offices will be affected as the transaction is rescinded. Meta will need to adjust its acquisition-related plans while it pursues other ways to expand its AI platform.