Meta Terminates $1.9B Deal with Chinese AI Startup Manus at Beijing’s Request

Meta has initiated the process to unwind its $1.9 billion acquisition of Chinese AI startup Manus, finalized in December 2025. The decision follows demands from Chinese authorities, who cited national security risks and violations of technology export regulations. Operational separation has already begun: Manus has been disconnected from Meta’s internal systems, and its employees have lost access to the startup’s tools for internal projects.

Manus’ founders are in talks to raise $719 million from external investors to buy back the company from Meta. If successful, the startup may restructure as a joint venture with Chinese partners and pursue an IPO in Hong Kong, where Chinese AI firms like MiniMax and Zhipu have been actively listing this year. Manus’ investors, including Benchmark, Tencent, and ZhenFund, have already received payouts from Meta and are prepared to collaborate during the separation process.

The Manus situation reflects China’s tightening grip on strategically critical technologies. The government has expanded restrictions on overseas travel for private AI company employees, requiring prior state approval. Additionally, major startups, including ByteDance, Moonshot AI, and StepFun, must now coordinate deals with U.S. investors. These measures complement previously introduced technology export rules and stricter controls over foreign investments.

Despite the split from Meta, Manus continues developing its products. The startup recently announced integrations with Similarweb and Shopify platforms, demonstrating its independence from its former owner. Manus’ journey began with a viral AI agent demo, after which the company relocated to Singapore and attracted Meta’s attention, leading to the record deal—and its subsequent unwinding.