According to the announcement from the office of the mechanism for foreign investment security review of the National Development and Reform Commission of the Chinese Communist Party on April 27th, China has made a decision to prohibit investment in the acquisition of the Manus project by foreign entities and has requested the parties involved to cancel the acquisition transaction.
Meta, the parent company of Facebook, announced last year an investment of over 2 billion US dollars to acquire Manus, an AI startup with Chinese background, which sparked an investigation by Beijing into foreign investment in Chinese enterprises and technology exports.
A spokesperson for the Chinese Ministry of Commerce, He Yadong, claimed at the beginning of April that the government supports enterprises in conducting cross-border operations and technology cooperation as needed, and that such actions must comply with laws and regulations.
Founded by Chinese engineers, Manus initially had a parent company in China before relocating its headquarters to Singapore. The company gained rapid attention in Silicon Valley for its AI applications capable of completing complex tasks without human intervention, positioning it as a promising AI startup team.
Meta announced its acquisition of Manus in December last year.
Although Manus had previously relocated its headquarters to Singapore and ceased operations in China, in January this year, the Chinese Ministry of Commerce stated for the first time that it would conduct an evaluation investigation into this acquisition.
Last month, the Financial Times cited sources as reporting that Manus CEO Xiao Hong and Chief Scientist Ji Yichao were summoned by the National Development and Reform Commission of the Chinese Communist Party in Beijing in March, regarding whether the entity was in violation of foreign investment regulations. After the meeting, the two were informed that they were not allowed to leave China due to regulatory reviews.
It was reported that Manus is actively seeking legal and consulting firms to assist in resolving the matter.
A spokesperson for Meta told Reuters via email, “This transaction fully complies with relevant laws. We expect that the investigation will be appropriately resolved.”
At the time, Reuters sought comments but both the Chinese Ministry of Public Security and Manus did not respond immediately.
At that time, Reuters cited sources reporting that Manus was valued between 2 billion to 3 billion US dollars.