Tencent Set to Take Over Manus, Unwinding Meta's $2 Billion Deal

Chinese investors are back in the running for Manus. Tencent is in talks that would make it the largest shareholder in the Chinese agentic AI startup, after Beijing ordered the reversal of an already-completed acquisition of the company by American Meta. It's a rare precedent in global tech policy, sending a $2 billion deal back to square one.

Manus is an agentic AI startup founded by Chinese engineers who relocated the company to Singapore in mid-2025. Meta announced its acquisition of Manus in December 2025, aiming to strengthen its agentic AI tools in the race against Google and OpenAI. The deal was finalized before Chinese authorities had a chance to review it.

How Beijing Unwound a Closed Deal

The trouble was that Meta and Manus never notified Chinese authorities before closing the deal. Beijing argued that Manus's intellectual property, developed on Chinese soil, remained subject to Chinese export-control law regardless of the fact that the company now formally operates out of Singapore. China's Ministry of Commerce opened a formal investigation in January 2026, citing export-rule violations and national security concerns.

In April, the National Development and Reform Commission ultimately blocked the deal from standing, and by June Meta had begun actually dismantling the already-signed agreement at Beijing's direction. It is the clearest case yet of Chinese authorities forcing a foreign company to unwind a transaction that had already been legally closed.

Who Will Take Over Manus Now

According to reporting from Bloomberg and the Financial Times, Tencent is in talks to take the largest stake in Manus. Manus's earlier investors are also part of the negotiations, including the fund ZhenFund and HSG, the former Chinese arm of Sequoia Capital. The scenario under discussion would see the company bought back at the same $2 billion valuation that underpinned the Meta deal.

The new Chinese legal framework, which took effect on July 1, 2026, gives Beijing for the first time a comprehensive, formalized legal basis for forcing the reversal of already-completed foreign transactions. It's a tool China can now apply to future deals involving Western tech companies.

What It Means for the Global AI Race

The Manus case shows that the US-China rivalry over artificial intelligence no longer stops at export controls on advanced chips. It now extends to talent, source code, and intellectual property developed by Chinese engineers, even after they've formally relocated abroad. For American companies, it's a signal that acquisitions of companies with Chinese roots, even ones incorporated in Singapore or elsewhere, can be unwound long after a deal has closed.

For Meta, the setback means losing the agentic AI technology it hoped would help it compete with ChatGPT and Gemini. For Polish and European companies weighing partnerships with Chinese AI startups, the case is a warning that cross-border deals of this kind now demand far more careful legal scrutiny on both sides, and that Chinese authorities are willing to intervene even after a deal has been finalized.

Sources: Tencent in Talks to Become Manus' Largest Holder, FT Reports (bloomberg.com), Meta reportedly begins dismantling $2 billion Manus deal on Beijing's orders (cnbc.com), The Tech Company Caught Up in Global Power Politics (thedispatch.com).