Key insights
- China has restricted the exit of Manus co-founders amid a review of Meta's acquisition for potential violation of investment rules. This action raises concerns about regulatory risks for foreign acquisitions of Chinese AI firms and could negatively impact Meta's expansion strategy in the AI sector. The increased regulatory scrutiny may deter future investments in Chinese tech companies.
March 25 (Reuters) - China has restricted two co-founders of artificial intelligence startup Manus from leaving the country as regulators review whether Meta’s $2 billion acquisition of the firm violated investment rules, the Financial Times reported.
Manus’s chief executive Xiao Hong and chief scientist Ji Yichao were summoned to a meeting in Beijing with the National Development and Reform Commission (NDRC) this month, the FT said on Wednesday, citing people with knowledge of the matter.
After the meeting, the executives were told they were not allowed to leave China due to a regulatory review while they remain free to travel within the country, the report said.
Manus is actively seeking law firms and consultancies to help resolve the matter, the newspaper said.
Reuters could not immediately verify the report. Meta and Manus did not immediately respond to requests for comment.
China’s Ministry of Public Security did not immediately respond to a Reuters request for comment.
In December, Meta said it would acquire Manus, which makes general-purpose AI agents that can operate as digital employees, executing tasks such as research and automation independently and with minimal prompts.
Financial terms of the deal were not released, but a source told Reuters at the time that the deal valued the Singapore-based firm at between $2 billion and $3 billion.
China’s commerce ministry said earlier this year that it would assess and investigate Meta’s acquisition of Manus.