Tencent moves to acquire Manus after Beijing forces Meta to unwind $2 billion AI deal

Tencent is reportedly in talks to acquire Manus from Meta, following Beijing intervention -- company expects to remain independent of Chinese tech giant

Manus is effectively cut off from Meta, but someone still has to pay back the $2 billion it spent on the startup. Meta's surprise purchase of Manus, a Chinese startup known for its advanced AI agents, caught Beijing by surprise and ordered the two companies to unwind the $2 billion deal. The Chinese tech giant Tencent, which was among the startup's initial investors during early funding rounds, is taking the lead in buying back the startup at the same price. According to the Financial Times, other former investors, including ZhenFund and HongShan Capital Group -- China-based venture capital firms -- while former U.S. investors like Benchmark are unlikely to join the potential consortium. This move marks Beijing's increasing protectiveness of its AI companies and experts, which it considers strategic assets in its heated rivalry with the U.S. We can see this in the Chinese government's five-year plan, which is doubling down on technological self-reliance. It has even gotten to the point that AI experts, even those working in private firms, are now required to secure approval before traveling internationally. U.S. tech giants are investing billions of dollars to develop their AI models, even dangling hundred-million-dollar bonuses to hire AI experts -- one AI founder even claimed that Meta offered a $1.25-billion bonus. It seems that China is trying to avoid a situation where its experts are enticed to work for American AI tech companies, with the Financial Times reporting that Chinese officials are calling Meta's acquisition of Manus "a conspiratorial attempt to hollow out China's technology base." The order to undo the deal means that Meta cannot use Manus' intellectual property, nor can it have its founders and employees working for the company. Still, the U.S. tech giant has had a few months to study its models and engineering expertise. Meta has already agreed to undo the deal, with most of Manus' operations reportedly running independently of the company. However, the Chinese startup still needs to break financially from the American tech giant by paying back the $2 billion the latter spent to purchase it. Even though Chinese companies are also investing massive amounts in AI tech, it's still not easy to raise this amount of capital in such a short period. Tencent, which owns the WeChat platform used by China's 1.4 billion population for messaging, social networking, mobile payments, ride-hailing, food delivery, and more, believes that Manus would be an asset for the company. Aside from reaching an annual revenue of $500 million, its AI agent would also mesh well with the company's increasing AI focus. "Beyond foundation models, it has become increasingly evident that agentic AI represents a breakthrough use case," Tencent president Martin Lau said in its May earnings call. "Our platform inherently has many benefits of hosting AI agents." Follow Tom's Hardware on Google News, or add us as a preferred source, to get our latest news, analysis, & reviews in your feeds.

Tencent leads deal to unwind Meta's $2bn Manus acquisition

Chinese tech giant set to become largest shareholder in AI agent start-up after Beijing ordered reversal of US takeover Tencent is in talks to become the largest shareholder of Manus as investors race to unwind Meta's $2bn acquisition of the AI agent start-up after Beijing ordered that the deal be reversed. Most of Manus's existing investors, including Tencent, ZhenFund and HSG, as well as the company's management, are discussing backing a deal that would unwind Meta's acquisition at the same $2bn valuation, according to two people familiar with the talks. The discussions remained ongoing and could also include new investors, while some existing backers, including US venture capital firm Benchmark, were unlikely to participate, the people said. Details are yet to be finalised as talks are ongoing. Tencent is expected to buy the largest stake in the transaction but remain a minority shareholder. Manus would continue to operate independently from Singapore rather than be folded into Tencent's business, the people added. The reversal of Meta's acquisition marks a significant escalation in Beijing's efforts to keep China's leading AI companies and talent under domestic control as competition with the US intensifies. China ordered Meta to unwind its $2bn acquisition of Manus in April, citing breaches of investment rules. Founders of Manus, including Xiao Hong, have been restricted from leaving the country after being summoned for a meeting in Beijing. Meta bought Manus in December 2025, months after the company moved its headquarters and core engineers to Singapore from China, where it was originally founded. Officials described the transaction as a "conspiratorial" attempt to hollow out China's technology base, the FT previously reported. Meta quickly folded Manus into its platform, including its advertising systems. It has now separated the operations and stopped data sharing, according to people familiar with the moves, though a formal financial unwinding has yet to take place. Ordering the deal to be unwound also serves as a warning to other Chinese technology companies against using Singapore as a staging post for eventual sales to US buyers. Investors backing the buyout are betting Manus can continue growing independently and eventually list in Hong Kong. Manus reached annual recurring revenue of close to $500mn earlier this year, up sharply from the time of the Meta acquisition, the people said. Whether it could sustain that growth outside Meta's ecosystem remained uncertain, one person cautioned. Any Hong Kong listing would probably require Manus to restructure to satisfy Chinese regulators, the people said. Tencent, which has a longstanding relationship with Manus and its founder Xiao, is betting a larger stake in Manus could have synergies with its own push into AI agents. "Beyond foundation models, it has become increasingly evident that agentic AI represents a breakthrough use case," said Tencent's president Martin Lau in an earnings call with analysts in May. "Our platform inherently has many benefits of hosting AI agents." Tencent is testing an embedded agent in WeChat, the ubiquitous app used by China's 1.4bn people for everything from messaging and social media to ride-hailing and payments. Xiao was among the first external users invited to test the feature when Tencent rolled it out to a small group of experts for feedback, the people said. Before Manus, Xiao's previous start-up was a customer relationship management platform based on the WeChat ecosystem. Tencent, Manus and ZhenFund did not respond to requests for comment. Meta and HSG declined to comment. Additional reporting by Cheng Leng in Beijing and Hannah Murphy in Santa Barbara

Tencent in talks to become Manus' largest shareholder

The Chinese tech giant is set to lead a group of original backers unwinding Meta's blocked $2bn purchase of the AI agent startup, according to the Financial Times. Manus was, briefly, one of the most valuable exits in Chinese AI. Meta agreed to buy the agentic AI startup for more than $2bn late last year, then watched Beijing block the deal on national-security grounds. Now the company is being bought back by the people who owned it in the first place, and Tencent looks set to sit at the front of the queue. Tencent is in talks to become Manus' largest shareholder, according to the Financial Times, whose report was picked up by Bloomberg and Reuters. The plan would see a consortium of the startup's earlier investors repurchase it at the same $2bn valuation Meta had agreed to pay, effectively reversing the acquisition. Tencent is expected to take the biggest slice, but the detail that matters is what it will not be. The company would remain a minority shareholder even as the largest single holder, according to the report, an arrangement that keeps any one investor from controlling a startup whose Chinese roots proved politically delicate. The consortium is largely a reunion of Manus' original backers. Alongside Tencent, it is said to include the venture firm ZhenFund and HSG, the investment house formerly known as Sequoia Capital China. New investors could still join the round, according to the report, while some former backers are expected to sit it out. Among the likely absentees is Benchmark, the US venture firm that had been an early Manus investor. Its expected absence underlines how far the startup's cap table is shifting from a mix of Chinese and American money toward a predominantly domestic one, which is broadly the outcome Beijing's intervention pointed to. Manus built its reputation on AI agents that carry out multi-step tasks with little human supervision, the same capability now driving a wave of investment into self-directed AI systems. That capability is also what made it a prize worth $2bn to Meta and, in a different reading, a strategic asset China preferred not to see pass into foreign hands. The company's commercial trajectory helps explain the enthusiasm. During its brief period inside Meta's orbit, with access to the larger company's traffic and advertising channels, Manus' annualised revenue is reported to have climbed to somewhere between $400m and $500m, up from around $100m before the deal. Those figures come from Chinese-language reporting and have not been independently confirmed, so they are best treated as indicative rather than audited. What the buyback restores is ownership, not necessarily that momentum. Unwinding an acquisition means Manus loses the distribution muscle that helped it grow so quickly, and the returning investors will have to fund the company's next phase without a strategic parent behind it. A minority-heavy structure keeps control diffuse, which is reassuring to regulators and complicated for management. The episode is also a marker of how China now handles its home-grown AI talent. Beijing has grown increasingly protective of the sector, and the reversal of the Meta deal, followed by a repatriation of ownership to domestic investors, reads as a template as much as a one-off. Companies built on agent technology have become assets the state watches closely. For Tencent, the move fits a broader pattern of backing Chinese AI champions rather than watching them drift abroad. The company has spread bets across models, chips and applications, and taking the lead stake in a returning Manus keeps a prized asset within a stable it already knows well. A minority position lets it do that without triggering the concentration worries that dogged the Meta deal. The talks are, for now, still talks. The structure is not final, the participants are not fully settled, and the valuation could yet move. What looks close to decided is the direction: Manus is coming home, and Tencent intends to be the largest name on the register when it does.

ETtech Explainer: How the Meta-Manus deal came apart, and Tencent moved in

Chinese regulators ordered Meta to reverse its $2 billion acquisition of the company. Tencent is working with Manus' early investors, including ZhenFund and HSG, to buy the company back from Meta for at least $2 billion. Chinese technology company Tencent is in discussions to become the biggest shareholder in artificial intelligence (AI) startup Manus, according to a Reuters report. The talks come after Chinese regulators ordered Meta to reverse its $2 billion acquisition of the company. Tencent is working with Manus' early investors, including ZhenFund and HSG, to buy the company back from Meta for at least $2 billion, Reuters reported, citing sources familiar with the discussions. The Financial Times first reported the talks. How the deal unfolded Meta announced its acquisition of Manus in December as part of its push into agentic AI. Back then, Manus chief executive Xiao Hong said, "Joining Meta allows us to build on a stronger, more sustainable foundation without changing how Manus works or how decisions are made... we will continue to iterate the product and serve users that have defined Manus from the beginning." Unmade in China However, soon, Beijing launched a regulatory review in April to determine whether the cross-border deal breached China's investment rules, before ordering Meta to unwind the acquisition. The decision is one of the most high-profile examples of China blocking or challenging a concluded cross-border technology deal. It also reflects tighter regulatory scrutiny as competition between Beijing and Washington over AI and advanced technologies continues to intensify. China rarely requires companies to reverse closed acquisitions, making the move particularly unusual. Also Read: In blocking Meta-Manus' $2 billion AI deal, China is trying to stem brain drain 'Singapore-washing' Another issue that reportedly drew regulatory attention was Manus' move to Singapore. Although the startup is now headquartered there, it was originally part of the Chinese firm Butterfly Effect before becoming an independent company. After raising $75 million in a round led by US venture capital firm Benchmark in May 2025, Manus shut its China offices and shifted operations to Singapore without seeking approval from Chinese regulators, according to reports. This practice, often referred to as 'Singapore-washing', involves Chinese technology companies moving their headquarters to Singapore while maintaining strong operational links with China. "Beijing has heretofore tolerated this practice, but the Manus case marks a major turning point (as the US-China AI race heats up)," Wendy Chang, at the Mercator Institute for China Studies (MERICS), told AFP in April. She added that the move sends a clear message to Chinese technology companies that attempts to bypass national regulations will not be tolerated. According to a Bloomberg News report last month, Meta has since separated its operations from Manus internally and stopped sharing data with the startup. Reuters had earlier reported that Manus' existing investors exited after the takeover. About Manus Manus gained attention early last year after state media and commentators described it as China's DeepSeek. The company said it had developed the world's first general AI agent that autonomously works towards achieving a goal. Unlike companies that build their own large language models, Manus develops an agent framework that runs on top of existing Western language models. The startup is also reported to have reached an annualised revenue of more than $100 million within eight months of its launch.

Global Market | Tencent explores stake in AI Startup Manus after China challenges Meta deal: Reports

Tencent is in talks to become the largest shareholder in AI startup Manus as investors seek to buy back the company from Meta after Chinese regulators ordered the US tech giant to unwind its $2 billion acquisition. The proposed deal would reshape Manus' ownership amid heightened regulatory scrutiny of cross-border AI investments. Chinese technology giant Tencent is in talks to become the largest shareholder in artificial intelligence startup Manus, as investors explore alternatives after Chinese regulators ordered Meta to unwind its $2 billion acquisition of the company, according to people familiar with the matter, Reuters reported. Tencent is negotiating a deal alongside Manus' original investors, including ZhenFund and HSG, to buy back the AI startup from Meta in a transaction valued at no less than $2 billion. US MarketsPowered By As on 10 Jul 2026, 01:30 AM IST S&P 500 Top Gainers Hewlett Packard49.11(9.94%) Norwegian Cruise Line19.76(6.98%) Lam Research353.17(6.01%) Invesco28.61(5.85%) Gainers" S&P 500 Top Losers Coterra Energy32.56(-8.62%) APA33.29(-5.05%) Costco Wholesale912.97(-4.21%) Cincinnati Financial175.43(-3.38%) Losers" The discussions come after Beijing ordered Meta to reverse its acquisition of Manus following a regulatory review into whether the cross-border deal violated China's investment rules. The Financial Times first reported Tencent's negotiations earlier on Friday. Buyback plan takes shape Reuters reported that the proposed transaction would see Tencent emerge as Manus' largest shareholder, while existing backers ZhenFund and HSG would also participate in the buyback. The talks reflect growing efforts by investors to restructure ownership of the AI startup after regulatory scrutiny derailed Meta's acquisition. Regulatory pressure on cross-border deals Meta announced its acquisition of Manus in December as part of its strategy to strengthen its capabilities in agentic AI, an area focused on AI systems capable of performing complex tasks with minimal human intervention. However, China launched a review of the deal in April, citing concerns over compliance with investment regulations. According to Reuters, the order requiring Meta to unwind the transaction became one of the latest examples of Beijing challenging cross-border acquisitions involving companies with Chinese ties amid heightened geopolitical tensions between China and the United States. Following the regulatory action, Bloomberg News reported last month that Meta had internally separated its operations from Manus and halted data sharing between the two companies. Manus' rise in AI Manus relocated its operations from China to Singapore last year while continuing to develop AI agents designed to autonomously complete tasks with limited human input. The company attracted widespread attention early last year after unveiling what it described as the world's first general AI agent. Reuters reported that the launch prompted state media and industry commentators to compare Manus with DeepSeek, positioning it as one of China's most promising AI startups. (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times.)

AI startup Manus: Tencent in talks to become AI startup Manus' largest shareholder

Tencent, together with Manus' original investors, including ZhenFund and HSG, are planning to buy the company back from Meta for no less than $2 billion, said one of the sources and a third person briefed on the ⁠matter. Chinese gaming and internet company ⁠Tencent ⁠is in talks to become Manus' largest shareholder as investors seek alternatives after Beijing ordered Meta to unwind its $2 billion acquisition of the AI startup, two people with ⁠knowledge of the matter said on Friday. The Financial Times first ⁠reported Tencent's talks earlier in the day. Tencent, together with Manus' original investors, including ZhenFund and HSG, are planning to buy the company back from Meta for no less than $2 billion, said one of the sources and a third person briefed on the ⁠matter. Tencent, Manus, Meta and the two investment firms did not immediately respond to Reuters requests for comment.

Tencent in talks to become largest shareholder in China's Manus- FT By Investing.com

Investing.com-- Tencent is in talks to become the largest shareholder in Manus after Beijing ordered Meta's acquisition of the Chinese artificial intelligence startup be reversed, the Financial Times reported on Friday. Tencent, ZHenFund, HSG, and Manus' management are in discussions over a deal to unwind Meta's acquisition at the same $2 billion valuation, the FT reported, citing two people familiar with the talks. Get more breaking news on the biggest AI firms by subscribing to InvestingPro The discussions are ongoing and could also include new investors, while former backers, such as U.S. venture capital firm Benchmark, are unlikely to participate, the report said. Tencent is expected to take the largest stake in the deal but will remain a minority shareholder, the report said. Manus rose to fame in early-2025 with the launch of its eponymous AI agent, which is able to independently complete complex tasks. China had ordered a reversal in Meta's acquisition of Manus in April, amid a growing push in Beijing to retain domestic control of its leading AI companies. A report earlier this week said Beijing was also considering measures to restrict overseas access to advanced Chinese AI models. Meta had quickly folded Manus into its operations after acquiring the firm in December, but has now separated operations, the FT report said. The Facebook owner on Thursday unveiled a major new AI model, Muse Spark 1.1, which it presented as its "strongest model for agentic and coding work yet."