China has decided to block Meta’s $2 billion acquisition of agentic AI startup Manus, a move to unwind a controversial deal that’s drawn fire for the leakage of technology to the US, country’s top economic planning body said. The National Development and Reform Commission ordered the deal’s cancellation in a brief statement Monday. The decision was made in accordance with laws and regulations, the powerful state planner said in a one-line notice, without elaborating. Meta representatives didn’t immediately respond to requests for comment.
The commission stated that it will “prohibit the foreign investment in the acquisition of the Manus project” and “requires the parties involved to withdraw the acquisition transaction”.
Meta, which owns Facebook, acquired Manus in December for more than $2 billion in a bid to boost its capabilities in AI agents.
China has tightened scrutiny of key industry firms in the wake of the deal, which has been largely completed. Initially hailed as a template for startups with global aspirations, critics have since lamented the loss of valuable technology to a geopolitical rival, Bloomberg reported.
Manus was supposed to help Meta leapfrog into a leading position in the hot sphere of AI agents, or services that use artificial intelligence to execute tasks.
The blockage move might come as a setback to Meta as it looks to compete in AI against rivals from Microsoft Corp. and Alphabet Inc.’s Google to OpenAI and Anthropic PBC.
The deal had triggered a tug-off between both the US and China as lawmakers in US have prohibited American investors from backing Chinese AI companies directly. Meanwhile, Beijing has increased efforts to discourage Chinese AI founders from moving business offshore.
Manus was hailed as China's next DeepSeek after releasing what it said was the world's first general AI agent. Founded in China, Meta was later relocated to Singapore. Manus develops general-purpose AI agents and launched its first general AI agent last year, which can execute complex tasks such as market research, coding, and data analysis.
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