Meta unwinds $2B AI acquisition after China order

Meta has begun dismantling its $2 billion acquisition of AI startup Manus following a directive from Chinese authorities to reverse the deal on national security grounds. The companies have initiated an operational separation, which includes halting data sharing and restricting internal access between Meta and Manus. Manaus announced it will resume independent operations and that certain user data generated after December 29, 2025, will be deleted later this month. Affected users will be notified and will have the ability to back up their data. The separation is a direct consequence of Beijing's April order to unwind the acquisition, citing violations of foreign investment and technology export rules. The National Development and Reform Commission (NDRC) asserted jurisdiction over Manus despite its 2025 relocation from Beijing to Singapore, viewing the company's Chinese origins and training data as grounds for control. This move is seen as part of China's broader effort to assert export-control authority over AI companies of Chinese origin. Manaus founders are reportedly seeking to raise approximately $1 billion to fund a buyback of the startup at its original valuation. The unwinding process also involves the return of Meta's equity stake and the exit of Meta's board representation. Chinese gaming and internet company Tencent has been in discussions to become Manus' largest shareholder.