Meta begins dismantling $2 billion Manus deal after Beijing order

Meta dismantling – Meta Platforms has started dismantling its $2 billion acquisition of Manus after Chinese regulators ordered the deal unraveled, according to a report describing operational steps that separate the companies’ systems and block access to Meta’s internal data.

The Meta logo sits behind the Manus logo on a smartphone screen—an image meant to suggest a deal completed. But inside Meta, the work has shifted from buying to undoing.

Meta Platforms has begun dismantling its $2 billion acquisition of Manus. a Bloomberg report said. as the tech company moves to comply with an order from Beijing to unwind the transaction. The separation includes an operational split at Meta that is already finished. with employees told to stop using Manus tools for internal projects. From this month, Meta also blocked Manus staff from accessing Meta’s internal data systems.

The unraveling has turned the $2 billion deal into a test case for how far China will go to protect what it considers strategic technology and talent—especially when the transaction is already complete. Chinese regulators ordered the deal to be reversed in April. an unprecedented move tied to the country’s foreign investment security review mechanism. according to the Zhonglun law firm. Beijing’s subsequent actions also coincided with tightened tech export controls aimed at keeping a firmer grip on cross-border transactions. particularly those involving assets in strategic sectors. as the U.S.-China tech race accelerates into a contest over talent. hardware and data.

For U.S. tech firms looking at Chinese assets, the risk isn’t just deal terms—it’s reversibility. “Chinese-origin AI now carries a kind of reversibility risk that no clever deal structure can price out,” said Matthias Hendrichs, a Singapore-based advisor to global AI firms.

Hendrichs added that for Manus, the core concern may not be fixable once the access happens. “Once another company’s engineers have been inside your stack, you can delete the repository, but you can’t make them unsee what they’ve seen.”

Manus itself has become part of a warning story for entrepreneurs trying to shed their Chinese identity by relocating. The agentic AI startup moved its headquarters and core teams to Singapore last year. before Meta announced its acquisition in December for $2 billion. triggering a months-long probe involving tech export controls.

At the center of the dispute is Beijing’s view of where the deal leaves sensitive knowledge. “The unwind may be messy,” said Han Shen Lin, China managing director at The Asia Group. Han said Beijing sent a message to the tech sector that the so-called “Singapore washing” has limits. and he argued the episode offers a lesson to Washington: shining a light on ownership structures may be as consequential as any prohibition.

The pressure is widening beyond this single transaction. Earlier this month. Beijing issued sweeping new rules tightening control of overseas deals involving Chinese investors. technology. data and national security concerns. The rules come as both Beijing and Washington race to tighten their grip on AI. Chinese regulators have reportedly instructed firms including Moonshot AI, StepFun and ByteDance to reject U.S. investment without explicit government approval. On the U.S. side, Washington recently broadened its AI chip export controls to China-headquartered firms globally.

The new outbound investment directives extend Beijing’s reach past mainland China. including Taiwan. and give regulators power to punish foreign firms whose home countries restrict Chinese investment. In the view of Tilly Zhang. an industrial policy analyst at Gavekal Dragonomics. the new framework targets deals like Manus—a high-profile move that signaled a leading Chinese AI firm was turning away from the domestic market. something Beijing did not want others to follow.

Zhang described what Beijing’s rules represent as a shift in leverage. Han said the framework essentially gives the state “a retroactive and forward-looking chokehold” on outbound capital. “If Chinese money touched a deal … Beijing can now assert jurisdiction over the exit, the restructuring, or the reinvestment.”.

Under the framework—which takes effect July 1—China is provided a comprehensive and formalized legal basis to force the unwinding of completed overseas transactions for the first time. The rules specifically ban cross-border talent transfers in sensitive sectors without approval.

For Meta and Manus. that legal machinery is already moving from the abstract into daily operations: Manus tools are being sidelined inside Meta. and Manus staff are being cut off from Meta’s internal data systems from this month. For everyone watching. the message is simpler than the process: once Beijing decides a deal must be unraveled. compliance can reach far deeper than contracts—into the workflow itself.

Meta Manus Beijing China regulators acquisition $2 billion deal foreign investment security review AI tools Singapore washing export controls outbound investment rules Moonshot AI StepFun ByteDance