China's chief economic planning agency, the National Development and Reform Commission (NDRC), announced on Monday its decision to block Meta's $2 billion acquisition of Manus, an innovative agentic AI startup. Manus, originally founded by Chinese engineers, had relocated its operations to Singapore before being acquired by Mark Zuckerberg's company late last year.
This intervention by the NDRC represents one of China's most significant actions in a cross-border corporate transaction, extending its implications beyond typical U.S.-China geopolitical tensions and into the broader global artificial intelligence sector. For Meta, this development could severely impact its strategic ambitions within the rapidly evolving domain of AI agents.
The NDRC issued a directive to both Meta and Manus, ordering the complete unwinding of the acquisition deal, notably without providing any public explanation for its decision.
"The National Development and Reform Commission (NDRC) has made a decision to prohibit foreign investment in the Manus project in accordance with laws and regulations, and has required the parties involved to withdraw the acquisition transaction," the commission stated.
Despite the NDRC's order, the situation is notably complex. Approximately 100 Manus employees had already transitioned into Meta's Singapore offices by March, with the startup's founders assuming executive roles within Meta. Manus CEO Xiao Hong, for instance, now reports directly to Meta COO Javier Olivan. Furthermore, reports indicate that Manus CEO Hong and Chief Scientist Yichao Ji are currently subject to exit bans, preventing their departure from mainland China.
Addressing the situation, a Meta spokesperson informed TechCrunch, "The transaction complied fully with applicable law. We anticipate an appropriate resolution to the inquiry."
Manus was established in 2022 by Hong, Ji, and Tao Zhang, subsequently moving its headquarters from China to Singapore around mid-2025. Only months later, Meta initiated its acquisition, which was publicly announced in December 2025. The deal, valued between $2 billion and $3 billion, aimed to integrate Manus's advanced agent technology directly into Meta AI.
While Meta's agreement to acquire the Singapore-based AI startup reportedly mandated a complete divestment from Chinese ownership and operations, as per Nikkei Asia, Manus's foundational roots trace back to China. Its founders had initially established a parent company, Butterfly Effect, in Beijing in 2022 before the relocation to Singapore. This background has attracted scrutiny in Washington, where Senator John Cornyn, as highlighted by TechCrunch citing his post on X, raised concerns about American capital, specifically Benchmark's investment, flowing into a firm with Chinese links.
Manus did not respond to TechCrunch's request for comment regarding the matter.
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