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How Meta plans to undo its $2.5B Manus acquisition
28 Apr 2026

Meta is preparing to reverse its acquisition of AI start-up Manus after the Chinese government blocked the deal on national security grounds, The Wall Street Journal reported.

The tech giant had acquired Manus AI for $2.5 billion last year and integrated its technology into its systems.

However, reversing this deal will be a complex process of disentangling operations, data, and technology that have already been integrated.

Manus employees were integrated into Meta's workforce
Transition

After the acquisition, Manus employees were integrated into Meta's workforce and moved to its Singapore offices. The start-up's leadership also joined the tech giant's AI division. Former investors such as Tencent, ZhenFund, and HongShan have received their payouts from this deal.

Former investors willing to cooperate
Investor response

Ex-Manus investors in Asia, including Tencent, HSG, and ZhenFund, are willing to cooperate if Meta goes ahead with its unwinding plan.

However, one major hurdle is that Manus's investors such as US-based venture capital firm Benchmark have already received returns from the deal.

This makes the unwinding process more complicated.

Preliminary deadline for unwinding the acquisition
Compliance timeline

Chinese authorities have given Meta and Manus a preliminary deadline of multiple weeks to unwind the acquisition and restore the start-up's Chinese assets.

This includes removing any data/technology previously transferred from Meta.

If they fail to do so, Beijing is considering imposing penalties on both companies.

The move comes amid heightened scrutiny over US investment in domestic start-ups developing frontier technologies.

Manus co-founders questioned by Chinese authorities
Founder status

Meta's acquisition of Manus had angered China, which began reviewing it shortly after.

In March, Manus AI's co-founders Xiao Hong and Ji Yichao were questioned by Chinese authorities over the acquisition. They were also barred from leaving the country pending an investigation.

Prior to yesterday's official ban, Meta had considered letting the founders depart as a potential concession to appease Beijing.