Startups
Manus AI Exits Meta Ownership After China Orders Divestiture
The Chinese startup will delete some user data and resume independent operations following Beijing's forced unwinding of Meta's $2 billion acquisition.
Key takeaways
- Manus AI will delete user data generated after December 29, 2025, as part of its separation from Meta and compliance with regulatory requirements.
- Beijing ordered Meta to unwind its $2 billion-plus acquisition of Manus in April as China tightened scrutiny of U.S. investment in Chinese AI startups.
- Tencent has been in talks to become Manus's largest shareholder following the forced divestiture from Meta.
- Affected users will be notified through the app and email with opportunities to back up their data before deletion.
- The case highlights China's increasingly assertive regulatory approach to foreign ownership of domestic AI companies.
Chinese AI startup Manus announced it will return to independent operations and delete certain user data as it completes its separation from Meta, following a regulatory order from Beijing that forced the unwinding of the acquisition.
The company said data generated by specific users on or after December 29, 2025, will be deleted later this month as part of the transition and to comply with regulatory requirements in certain jurisdictions. Affected users will receive notifications through the Manus app and email, with opportunities to back up their information before deletion.
Why it matters
The forced divestiture illustrates China's increasingly assertive stance on foreign investment in domestic AI companies, particularly as competition intensifies between the U.S. and China in frontier technologies. The requirement to delete user data suggests regulatory concerns extended beyond ownership structure to data governance and sovereignty issues. For Meta, the unwinding represents a significant setback in its efforts to expand AI capabilities through acquisition in the world's second-largest economy.
Regulatory intervention
In April, Chinese regulators ordered Meta to divest its ownership of Manus, which the company had acquired for more than $2 billion. The directive came as Beijing tightened scrutiny of U.S. investment in Chinese startups developing advanced technologies, reflecting broader geopolitical tensions around technological competition.
The acquisition had represented one of Meta's larger bets on AI capabilities, though details of Manus's specific technology and market position were not disclosed in the company's statement.
Tencent in talks
According to Reuters reporting in July, Chinese gaming and internet giant Tencent has been in discussions to become Manus's largest shareholder following the separation from Meta. The potential involvement of a major Chinese technology company would keep the startup within domestic control while providing substantial resources for continued development.
The transition back to independent operations marks a notable example of regulatory intervention reshaping cross-border technology deals, particularly in the AI sector where both the U.S. and China view leadership as strategically critical.
These details were first reported by Reuters, with reporting by Xiuhao Chen and Ryan Woo.
