Meta reportedly moves to unwind $2B Manus deal after Beijing’s demand

Meta has begun dismantling its $2 billion acquisition of Chinese-founded AI startup Manus, completing an operational separation and halting all data sharing between the two companies. The move represents the most concrete step yet toward complying with a divestiture order Beijing issued approximately two months ago on national security grounds.

According to a report on the divestiture, Meta has cut Manus off from its internal systems, preventing employees from using the startup's tools for internal projects. The unwinding highlights Beijing's growing determination to maintain strict control over strategically sensitive artificial intelligence technologies, regardless of a company's offshore incorporation status.

Operational separation and system lockout

The operational separation marks a sharp reversal for what was originally positioned as a landmark exit for Chinese AI. Bloomberg first reported that Meta's internal lockout has completely severed Manus from Meta's infrastructure. This rapid unwinding halts any immediate plans Meta had to integrate Manus's agentic AI technologies into its consumer or enterprise product suites.

The abrupt termination of data sharing ensures that no proprietary Meta user data or model weights are transferred to the startup. Security teams at Meta reportedly prioritized this isolation to prevent potential regulatory penalties from both Chinese and Western authorities, who are increasingly sensitive about cross-border data flows.

The $1 billion buyback proposal

As the acquisition falls apart, the founders of Manus are reportedly seeking alternative paths to keep the company viable. TechCrunch reports that the co-founders have held preliminary discussions to raise approximately $1 billion from outside investors. This capital would be used to reclaim the startup from Meta and establish an independent corporate structure.

The proposed funding round could pave the way for a Chinese joint venture structure. This arrangement would allow Manus to pursue an eventual public listing in Hong Kong. The Hong Kong exchange has recently seen a surge in AI listings from prominent Chinese startups, including MiniMax and Zhipu, as domestic capital markets adapt to geopolitical divisions.

Parallel Western restrictions

The forced divestiture of Manus occurs alongside escalating Western efforts to restrict foreign access to advanced AI models. The White House recently imposed strict export controls on Anthropic's Mythos 5 and Fable 5 models. According to reporting on the restrictions, US officials feared that a China-linked group had successfully accessed the technology.

The export control directive was reportedly triggered by cybersecurity research from Amazon. A report detailing the ban notes that Amazon CEO Andy Jassy personally discussed security concerns with White House officials. Amazon's research demonstrated that Fable 5 could be prompted to serve up information usable in cyberattacks, prompting immediate government intervention.

International regulatory fallout

These aggressive regulatory interventions are creating a highly fragmented global market for AI developers. The restrictions on Anthropic have already drawn scrutiny from European regulators. A European Commission spokesperson confirmed the body is actively looking into the practical consequences of the US decision on European enterprises.

The combination of Beijing's forced divestitures and Washington's export bans suggests that multinational tech companies will face severe friction when operating cross-border AI businesses. For Meta, the loss of Manus represents a costly setback in its effort to acquire external talent and technology to compete in the agentic AI space.