- Meta announced the acquisition of the AI startup last December, with the deal reportedly valued at around $2 billion.
- The move marks the collapse of a key expansion plan for Meta in the AI sector due to Chinese regulatory hurdles.
China has officially blocked Facebook parent Meta from acquiring the artificial intelligence (AI) project Manus, following widespread discussions after the deal was announced late last year.
The Office of the Working Mechanism for Foreign Investment Security Review under China's National Development and Reform Commission (NDRC) announced the decision on Monday, ordering the reversal of the cross-border acquisition.
This marks the collapse of the US tech giant's crucial expansion plan in the AI sector due to regulatory hurdles.
In December last year, Meta announced its agreement to acquire Manus's parent company, Butterfly Effect, in a deal some reports valued at up to $2 billion.
This was the third-largest acquisition in Meta's history, trailing only its purchases of WhatsApp and Scale AI in transaction value.
According to the original plan previously announced by both parties, the startup was to continue operating independently after the buyout.
Manus, which primarily develops AI agent products for small and medium-sized enterprises, sparked widespread market attention and heated discussions in early 2025.
The company's original office was in Wuhan, Hubei province in central China, before its core business personnel were entirely relocated to Singapore late last year.
Its product head had also publicly said that the company's headquarters had officially moved from China to operate out of Singapore.
Although Manus attempted to mitigate potential compliance risks in the cross-border merger by moving its headquarters overseas and restructuring its domestic business team, China's Ministry of Commerce explicitly said earlier this month that companies engaging in transnational operations and technological cooperation must strictly abide by Chinese laws and regulations.
The explicit ban by the NDRC further indicates that Chinese regulators remain on high alert regarding cross-border transactions involving core AI technologies.
