Beijing has decided Meta’s Manus buyout smells like a stitch-up.
China’s National Security Commission, led by Chinese President Xi Jinping, reportedly branded Meta’s $2bn acquisition of Manus a “conspiratorial” attempt to hollow out the country’s tech base, kicking off a multi-agency scramble to contain the fallout.
That view was reached soon after the deal was announced in December 2025, turning what looked like a landmark tech exit into a national security headache. Regulators have since brought in bodies, including the National Development and Reform Commission, the commerce ministry, and China’s antitrust watchdog, to review the transaction.
Officials are said to be probing the deal with whatever tools they can find, from export controls to foreign investment and competition laws. The case has become a test of how far Beijing will go to stop tech talent and capital leaving in an era of intensifying rivalry with the US.
Manus, an AI start-up that moved its core team and headquarters from Beijing to Singapore, is now stuck in limbo. In March, co-founders Xiao Hong and Ji Yichao were summoned by the NDRC to discuss potential violations of China’s foreign investment rules and have since been barred from leaving China.
A person close to the matter said Manus management has considered leaving Meta as a potential fix, though nothing has been finalised. It is still unclear whether that would satisfy Chinese authorities.
The Financial Times said this account comes from interviews with people who declined to be identified for security reasons. It marks a sharp reversal from just months earlier, when regulators reviewed Manus’ decision to shut down its China operations and relocate to Singapore and decided it did not warrant strict controls.
Officials at the time judged that the company did not hold core technology subject to export controls and that its capabilities could be easily replicated. That earlier call is now under pressure as political scrutiny ramps up, forcing regulators to revisit the case and hunt for fresh legal hooks.
In March 2025, Manus launched a product that went viral, pitching “agentic” AI capable of carrying out complex, multi-step tasks. Invitation codes traded for as much as $15,000 on secondary markets in China and Silicon Valley, and more than a million users joined a waiting list.
The hype did not last. Critics dismissed Manus as a “wrapper” with no proprietary technology, arguing it was just orchestrating models from companies such as Anthropic and Alibaba by breaking prompts into sub-tasks.
Even with that scepticism, Manus raised $75mn in April 2025 from investors including US venture capital firm Benchmark, hitting a $500mn valuation. Revenue climbed to nearly $100mn, driven largely by subscriptions, as its user base grew past 1mn.
In June 2025, Manus shut down its China operations and relocated to Singapore, where it could access US-developed AI models and attract overseas capital. The move triggered backlash on Chinese social media, including one widely shared Weibo post: “Manus abandons its home country after leveraging cheap and quality Chinese engineers to develop its product.”
Meta agreed to acquire Manus for $2bn in December 2025, and the deal came together at unusual speed within two weeks of initial contact. A person involved in the process said neither party informed Chinese regulators before the deal was announced.
At first, the acquisition was treated as a rare win, a Chinese start-up threading regulatory needles to land a big-ticket exit with a US buyer. A few days after the announcement, China’s Ministry of Commerce began an initial review into whether the transaction breached technology export controls, and people familiar with the matter said it did not find clear violations.
That changed after the National Security Commission stepped in. Its report, which characterised the deal as “conspiratorial”, was circulated among senior leaders and triggered a broader review across multiple agencies.
Some Manus investors who sold their shares to Meta have since held preliminary talks about unwinding the deal to address regulatory concerns. Any unwinding would be messy, since Meta has already integrated Manus into its ads management tools.
