Global investment banking transactions and private equity/venture capital databases show that in the first half of 2026, 10 major global private equity firms did not make any public disclosures of new equity investments in China. Industry insiders believe that this signifies that the world’s largest private equity funds have essentially exited the new investment market in China this year.
Private equity industry media outlet Private Equity Wire reported on August 18 that, according to global investment banking transaction data compiled by the Financial Times, the top ten global private equity firms including KKR, Warburg Pincus, Carlyle, TPG, EQT, Bain Capital, Advent International, Apollo, and CVC did not make any public disclosures of new equity investments in China from January to July 2026.
The same institutions completed three disclosed equity investments in China in 2025, and two in 2024; while in 2021, they completed around 12 transactions, including some early-stage investments.
However, the investment momentum of these private equity firms in other regions of Asia continues to be strong. For instance, EQT recently closed a record-breaking $15.6 billion Asia-Pacific private equity fund; Blackstone also completed a $13.1 billion fund focusing on the Asian market in June this year.
Industry analysts point out that with Beijing strengthening scrutiny on foreign capital in strategically sensitive industries like AI, international investors are facing increasing challenges.
In April this year, Meta was forced to halt its acquisition of Chinese AI startup Manus, which market watchers called “one of the most significant interventions by the Chinese government in cross-border transactions.”
The National Development and Reform Commission (NDRC) of China stated on April 27 that it had blocked Meta’s $2 billion acquisition of Manus. Manus, founded by Chinese engineers, had relocated to Singapore by the end of 2025 before being acquired by Meta.
The NDRC did not provide detailed explanations, only stating that “in accordance with relevant laws and regulations, it has decided to prohibit foreign investment in the Manus project, and requires relevant parties to withdraw the acquisition transaction.”
The situation, however, is far from simple. As of March this year, around 100 Manus employees had moved to Meta’s office in Singapore, with its founder holding a senior management position. Manus CEO Xiao Hong reported directly to Meta’s Chief Operating Officer Javier Olivan.
Reportedly, Manus CEO Xiao Hong and Chief Scientist Ji Yichao were summoned by the NDRC in March and were not allowed to leave mainland China under the guise of regulatory review. In January this year, various departments including the Chinese Ministry of Commerce initiated an evaluation of the transaction to review whether it involved technology export controls, technology import and export regulations, as well as foreign investment-related provisions.
A Meta spokesperson at the time stated, “This transaction fully complies with applicable laws. We look forward to the investigation being properly resolved.”
Manus was founded by Xiao Hong, Ji Yichao, and Zhang Tao in 2022, and around mid-2025, it moved its headquarters from China to Singapore. Just a few months later, in December 2025, Meta announced the acquisition of Manus for approximately $2 billion to $3 billion and planned to directly integrate its AI agent technology into Meta AI.
Manus’s product is not just a “chatting” AI robot, but an AI agent capable of autonomously decomposing tasks, calling on multiple AI sub-agents, and actually executing research and programming tasks. This made it seen as an important direction for the next generation of AI applications. The Chinese government did not want these technologies and talents to enter foreign companies.
China’s regulatory intervention not only affects foreign entry into China but also poses greater uncertainty for foreign exits.
From 2024 to 2025, global large-scale PE funds faced issues including restrictions on their first-time public offerings (IPOs) in China, lackluster merger deals, and valuation declines, with many unable to completely exit their investment portfolio companies in China.
Take the tightening of IPOs as an example, the Chinese government in recent years significantly raised the threshold for enterprise listings, slowed down the approval process, and even encouraged some companies to withdraw their IPO applications. In the first half of 2024, the total fundraising amount of IPOs on the Shanghai and Shenzhen stock exchanges was only about $4 billion, less than 14% of the approximately $29.8 billion in the same period of 2023. IPOs were originally an important exit channel for PE funds, so for foreign PE investors, even if the invested companies were doing well, they might face the dilemma of “being able to invest but unable to sell.”
In 2025, these ten largest global PEs did not completely exit any disclosed mainland China investment portfolios. It was not until January 2026 that Bain Capital sold its China data center business to a consortium of Chinese industry companies and local government funds for an estimated value of around $4 billion, breaking this trend.