Meta Platforms is preparing to unwind its acquisition of artificial intelligence startup Manus after China blocked the deal on national security grounds, according to people familiar with the matter, News.Az reports, citing the Wall Street Journal.

Earlier on Monday, China ordered the U.S. technology giant to reverse its more than $2 billion acquisition of Manus, as Beijing intensifies scrutiny of U.S. investment in domestic startups working on frontier technologies.

According to the Journal report, the Singapore-based AI startup’s investors, including venture capital firm Benchmark, have already received their returns.

Meanwhile, several former Manus investors in Asia, including Tencent, HSG, and ZhenFund, are reportedly prepared to cooperate if Meta proceeds with unwinding the deal.

Beijing has given the two companies a preliminary deadline of several weeks to reverse the transaction and fully restore Manus’s Chinese assets to their original state, the Journal reported. This would include removing any data or technology previously transferred from Meta.

Chinese regulators have also considered imposing penalties on Manus and Meta if the deal cannot be fully unwound, the report added.

The move comes weeks ahead of a planned mid-May summit in Beijing between U.S. President Donald Trump and Chinese President Xi Jinping.

China’s commerce ministry launched an investigation into the sale in January, just days after Meta completed the acquisition.

News.Az 

By Nijat Babayev