China blocks Meta AI buyout, forces major reversal

Meta Platforms is preparing to undo its multi-billion-dollar acquisition of AI startup Manus after Chinese authorities blocked the deal on national security grounds.

The move follows a direct order from Beijing, which is tightening its oversight of foreign investment in domestic companies working on advanced technologies, especially in artificial intelligence. The deal—valued at over $2 billion—had already been completed before regulators stepped in, News.Az reports, citing Reuters.

Sources familiar with the situation say investors in Manus, including U.S.-based venture firm Benchmark, have already received returns. Meanwhile, major Asian backers such as Tencent, HSG, and ZhenFund are reportedly preparing to coordinate their next steps if the transaction is formally reversed.

Chinese regulators have given both companies only a few weeks to fully unwind the deal. This process would require restoring Manus’s Chinese assets to their original state and removing any data or technology that may have been transferred to Meta.

Officials are also considering penalties if the reversal is not completed in full, signaling how seriously China is treating control over sensitive technologies.

Neither Meta nor Manus has publicly commented on the report so far.

The development comes at a politically sensitive moment, just weeks before a planned meeting in Beijing between Donald Trump and Xi Jinping—a backdrop that highlights growing tensions over technology, investment, and national security between the world’s two largest economies.

China’s commerce ministry had already launched an investigation into the deal earlier this year, shortly after the acquisition was finalized, underscoring a broader push to keep strategic tech assets under tighter domestic control.

News.Az 

By Aysel Mammadzada