China blocks Meta's $2 billion Manus AI acquisition

China’s National Development and Reform Commission ordered Meta to unwind its $2 billion acquisition of AI startup Manus, citing unspecified laws and prohibiting foreign investment in the company. The move — rare in reversing completed deals — forced Manus and Meta to withdraw from the transaction and raises regulatory risk for foreign tech deals tied to Chinese-origin talent or IP. Meta’s stock dipped about 0.2% in premarket trading. The decision complicates any divestiture: funds have changed hands, Manus staff were integrated into Meta, and several Chinese investors reportedly cashed out. Regulators have signaled stricter scrutiny of AI capability transfers, a trend that could deter cross-border M&A and affect valuations and deal-making for U.S. tech firms operating in or near Chinese technology ecosystems.