National Development and Reform Commission has blocked Meta’s planned acquisition of Manus, ordering both parties to unwind the deal in a move that affects a major cross-border transaction in the artificial intelligence sector.
Regulatory Decision And Immediate Impact
The NDRC said it prohibited foreign investment in the Manus project in accordance with applicable laws and required a full withdrawal of the acquisition. The agency did not provide a detailed explanation for its decision.
The deal, valued at approximately $2 billion to $3 billion, had been announced in December 2025, with Meta planning to integrate Manus’ agentic AI technology into its broader AI systems.
Company Background And Relocation
Manus was founded in 2022 by Xiao Hong, Yichao Ji, and Tao Zhang. The company originated in Beijing under a parent entity known as Butterfly Effect before relocating its headquarters to Singapore in mid-2025.
The relocation positioned Manus as a Singapore-based company, though its Chinese origins remained a factor in regulatory scrutiny.
Operational Integration And Workforce Movement
Following the acquisition announcement, around 100 Manus employees had already moved into Meta’s Singapore offices by March. Leadership integration had also begun, with Hong reporting to Javier Olivan. Despite this, reports indicate that Hong and Ji are currently under exit bans in China, preventing them from leaving the country.
Meta Response And Legal Position
Meta said the transaction complied with applicable laws and indicated it expects a resolution to the regulatory inquiry. The company had agreed to structure the acquisition with a full exit from Chinese ownership and operations as part of the deal terms.
Political And International Scrutiny
The transaction has drawn attention in the United States. John Cornyn raised concerns about investment flows into companies with links to China, referencing involvement from firms such as Benchmark.
The intervention by Chinese regulators highlights the complexity of cross-border AI deals, particularly those involving companies with ties to multiple jurisdictions.
Featured image credits: Automated Marketer
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