China's state planner has ordered Meta to unwind its $2 billion acquisition of Manus, an agentic AI startup with Chinese roots, throwing one of the most-watched cross-border AI deals of the past year into chaos. The National Development and Reform Commission (NDRC) issued a brief statement Monday calling for the cancellation, citing laws and regulations without elaborating, according to Bloomberg.
The move escalates Beijing's campaign to keep its strongest AI talent and intellectual property out of US hands, and raises immediate questions about how Meta could possibly reverse a deal whose pieces have already moved across borders.
A deal that was already done
Meta announced the takeover in December, shortly after Manus said it had surpassed $100 million in annualized revenue. Launched in March 2025, Manus builds general-purpose AI agents capable of executing complex multi-step tasks — from S&P 500 analysis to coding to drafting sales pitches — and quickly became one of the most talked-about agentic AI products in Asia.
Though Manus was incorporated in Singapore, its founders Xiao Hong and Ji Yichao came from China and the company maintained operational ties there. Beijing officials launched a probe just days after the December announcement, citing potential national security issues and export-control violations after Meta and Manus failed to notify Chinese authorities ahead of signing.
In the months that followed, the founders were barred from leaving China while regulators reviewed the transaction. By the time the NDRC's order arrived on Monday, however, much of the deal had already been executed: capital had been transferred, exiting investors including Tencent, ZhenFund and Hongshan had received their proceeds, and Manus employees had moved into Meta's Singapore offices, with several executives joining Meta's rapidly expanding AI team.
A new firewall around Chinese AI
The Manus reversal slots into a broader pattern. Bloomberg reported in recent weeks that the NDRC and other agencies have privately told leading Chinese AI firms — including Moonshot AI and Stepfun — to reject US-origin capital in their funding rounds unless explicitly approved. Together, the moves amount to a firewall around China's most strategically valuable AI startups.
For Washington and Silicon Valley, the message is that the era of quietly buying Chinese-origin AI talent through Singaporean or other offshore corporate shells is closing. For Meta, which has spent the past year aggressively assembling a superintelligence-focused AI organization, the order represents one of the most disruptive regulatory interventions yet in its acquisition spree.
What happens next
Neither Meta nor Manus has detailed how an unwind would work in practice. The legal mechanics — recovering transferred funds, reversing employment contracts, and separating already-integrated technology — could take months and may invite litigation. Investors and rival hyperscalers will be watching closely: any precedent set here will shape every future cross-border AI deal involving a Chinese-founded company.
