New Delhi: Meta Platforms has been thwarted in its ambitions to buy Chinese AI startup Manus AI for US$2 billion, in a deal that underscores the growing competition between the US and China over control of emerging technologies. The news, verified on April 27, 2026, is seen as a significant challenge to the ambitions of Meta, one of the world’s largest technology companies, in the field of artificial intelligence (AI), as well as a warning sign of the growing nationalism in China’s tech industry.
The transaction, originally announced in late 2025, was part of Meta’s efforts to bolster its presence in the burgeoning field of artificial intelligence, especially in the field of autonomous AI agents, which are systems capable of carrying out sophisticated tasks like programming, research and data analysis with little or no human intervention. A relative newcomer, established in 2025, Manus had rapidly made a name for itself in this field and was seen as an attractive acquisition for its technology and capabilities.
Meta vs China
But the Chinese government’s most senior economic agency, the National Development and Reform Commission, stepped in following several months of scrutiny, and ordered a halt to the deal. The government’s reasons related to legal and national security risks, pointing to the potential implications of transferring sophisticated AI technology to a foreign entity in terms of sovereignty.
The thwarted takeover highlights the importance of artificial intelligence to many governments. In China, safeguarding local innovation and maintaining control over technology has become a priority. Government officials are most concerned about overseas companies gaining access to its algorithms, data and engineering talent, which could boost competitors overseas.
Ironically, to establish itself as an international enterprise, Manus moved some of its functions to Singapore, a common strategy among Chinese startups to secure global investment. Nonetheless, officials reportedly broadened their focus from incorporating the company to looking at the company’s technology and research and development operations, and its implications for data security. This move ultimately resulted in a blocked deal, pointing to the fact that such tactics might not be sufficient in penetrating the market.
The timing of the decision is also significant. Investments in artificial intelligence are set to increase, to the point where the world’s technology giants will spend around $650 billion in 2026 alone. Meta is at the forefront of this trend, investing billions in AI infrastructure, talent and innovation. The Manus acquisition was a means to ramp up its efforts and keep pace with competitors such as OpenAI and Google.
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