Chinese authorities are reviewing Meta’s $2 billion acquisition of AI startup Manas for alleged technology control violations, the FT reported on Tuesday.
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China announced on Thursday that it would investigate Metaacquired artificial intelligence startup Manas for $2 billion to assess compliance with export control laws.
Meta acquired Singapore-based Manus last month. The US tech giant aims to integrate advanced automation into its consumer and business products.
Terms of the deal were not disclosed, but the Wall Street Journal reported that the deal was worth more than $2 billion, according to people familiar with the deal.
China’s Ministry of Commerce said it would evaluate and investigate how the acquisition complies with laws and regulations on export control, technology import and export, and foreign investment, according to a statement translated by Google.
“The Chinese government consistently supports enterprises to carry out mutually beneficial cross-border business and international technical cooperation in accordance with laws and regulations,” Commerce Ministry Spokesperson He Yadong said at a press conference.
Manus started as a product of Chinese startup Butterfly Effect, also known as Monica.Im, but has since grown into an independent company and moved to Singapore earlier this year.
The startup was hailed as the next DeepSeek after releasing its first AI agent in March to help with tasks such as market research, coding, and data analysis.
The company reportedly laid off most of its employees in Beijing in July as it looks to expand globally. Mr Manas said the acquisition of Meta would allow the company to continue operating in Singapore. The company said it had 105 employees in South Asian countries, Tokyo and San Francisco as of December.
Manas announced in December, eight months after the product launch, that it had surpassed $100 million in annual recurring revenue (ARR), making it the world’s fastest startup to reach this milestone from $0.
“Manus’ extraordinary talent will join the Meta team to provide general-purpose agents across our consumer and business products, including Meta AI,” Meta said in a December statement.
The acquisition follows the company’s $75 million funding round led by US VC Benchmark in April.
Nick Payens, head of AI at Futurum Group, told CNBC that the Chinese study “underscores that (the country) views advanced AI agents, models and related intellectual property as strategic assets.”
“The most likely outcome in my view is a longer approval process and potential conditions on how the Chinese-developed Manus technology can be used, rather than a complete block, but the threat of stricter measures gives the Chinese government bargaining power in the midst of a high-profile US-led acquisition,” he added.
CNBC has reached out to Mehta and Manus for comment.
