China’s state planner on Monday called for that Meta to release its $2 billion purchase of Manus, a Singaporean AI startup with Chinese roots.
The decision to ban foreign investment in Manus was made in accordance with laws and regulations, the National Development and Reform Commission said in a brief statement. It added that it has asked the parties involved to withdraw the transaction.
CNBC has reached out to Meta for comment. Shares were down 0.2% in premarket trading.
The deal has attracted scrutiny from China and Washington, as US lawmakers have banned American investors from directly supporting Chinese AI companies. Meanwhile, Beijing has stepped up efforts to discourage Chinese AI innovators from taking business overseas.
The Chinese government’s intervention in these transactions attracted tech innovators and capitalists in the country who hoped to take advantage of the so-called “Singapore-washing”, where companies move from China to the city to avoid scrutiny from Beijing and Washington.
Manus was founded in China before moving to Singapore. The company develops general-purpose AI agents and launched its first AI agent in March last year, which can perform complex tasks such as market research, coding, and data analysis. The release saw the startup being hailed as the next DeepSeek.
Manus said it passed $100 million in annual recurring revenue (ARR) in December, eight months after launching the product, which he said made it the fastest startup in the world at the time to hit the milestone from $0.
The company raised $75 million in a round led by US VC Benchmark in April last year.
When Meta announced the deal late last year, the tech giant said it would look to accelerate AI innovation for businesses and integrate advanced automation into its consumer and business products, including its Meta AI assistant.
But in January, China’s Ministry of Commerce said it would conduct an audit and investigate how the purchase complies with laws and regulations on export controls, technology imports and exports and overseas investment.
A spokesperson for Meta told CNBC in March that its findings “fully comply with applicable law,” and that the team is awaiting “an appropriate decision regarding the investigation.”
When asked about China’s move to block the purchase of Meta’s Manus, APEC Summit Chairman Chen Xu told reporters that “it is important that all parties behave in a spirit of mutual benefit.”
Although Chen said he did not know the details of the issue, he said that “if such an issue is handled properly, it can help advance important discussions in APEC.” That’s according to the official English version of Chinese.
— CNBC’s Anniek Bao and Dylan Butts contributed to this story.
