China Kills Meta's Acquisition of Manus as US-China AI Rivalry Deepens

In a move that underscores the growing tensions between the US and China in the field of artificial intelligence, China's government has blocked Meta's acquisition of Manus, a startup founded by Chinese tech entrepreneurs. The development highlights the increasing difficulty for US and Chinese tech companies to forge and maintain such deals, as government authorities on both sides take a harder line. The Chinese government formally asked Meta to unwind the acquisition on April 27, after deciding to ban foreign investment in Manus based on national security concerns.

The $2 billion deal, which was announced in December 2025, had been under scrutiny by Chinese regulators since January 2026. As part of the investigation, the two cofounders of Manus were instructed not to leave China. Manus, which burst onto the scene in March 2025, had developed a "general AI agent" designed to assist users with tasks such as searching for real estate, booking travel arrangements, and more.

The Manus AI agent uses an "agentic wrapper" or "agentic harness" to enable an underlying AI model - in this case, Anthropic's Claude 3.7 Sonnet - to take actions to carry out user requests. The company's technology incorporates multiple AI agents to perform and verify tasks, including a planner agent and an executor agent that can interact with websites, create spreadsheets, and even code new applications. The blocked acquisition is a significant setback for Meta, which had been looking to expand its capabilities in the field of artificial intelligence.

The move also underscores the challenges facing tech companies looking to make deals across the US-China divide, as government authorities on both sides become increasingly wary of foreign investment and technology transfers. The US-China rivalry in AI has been intensifying in recent years, with both countries investing heavily in the development of AI technologies. The blocked acquisition of Manus is just the latest example of the hurdles facing tech companies looking to collaborate across the divide.