Meta could be forced to divest Manus, the artificial intelligence platform that it acquired in January, after China’s National Development and Reform Commission ruled that the acquisition is invalid, and must be reversed. This ruling comes despite Meta having already incorporated Manus’ tools into its ads platform.
Meta acquired Singapore-based Manus in January as part of a $2 billion deal. Since then, Meta has integrated Manus’ agentic AI tools into its ad creation process, as another means to help advertisers maximize their ad performance and better understand opportunities.
While Manus is based in Singapore now, the company was founded in China. As such, the business entity still comes under China’s tough cybersecurity laws, which include review of any foreign investment.
That review, according to The Financial Times, determined that both Meta and Manus are required to “withdraw the acquisition transaction.” The full reasoning for the decision is not clear, and it’s also not clear how Meta will go about unwinding Manus from its systems, if the decision holds, The Financial Times said.
The move reflects a broader push by China’s leadership to enact more control over foreign investment, particularly in relation to AI development. The U.S. and China are both racing to lead the way on AI, and as such, China’s regulators are now seeking to take a bigger role in enforcing more stringent rules around related investments.
Meta said the Manus deal met all legal requirements, and that the company hoped for a positive resolution ahead of the final verdict. But now, Meta is in a difficult position, and could be forced to detach Manus’ tools from its systems.
The decision is further complicated by the fact that in March, Manus’ two founders were summoned to Beijing for talks with regulators, then banned from leaving the country, as reported by Reuters.
In theory, Meta should be able to unwind Manus’ tools, and put more reliance back on its own evolving AI systems.
But the case highlights the growing isolationism between the U.S. and China over AI development as AI becomes an increasingly defining tech and each nation looks to lead the way.
Meta hasn’t confirmed its plans in response to the findings as yet.
