Just days after the news, Chinese regulators have opened an investigation into Meta’s purchase of AI startup Manus, a deal reported to be worth about $2 billion. CNBC reported on Jan. 8 that the review will check if the acquisition follows China’s export control rules and laws tied to technology trade and overseas investment.
The Ministry of Commerce will run the process. According to CNBC, officials will assess how the transaction fits existing rules on technology imports and exports. The review also covers overseas investment linked to advanced software and data tools.
At a press briefing, Ministry of Commerce spokesperson He Yadong said the government supports cross border business and international technology cooperation when companies act within the law. CNBC reported that the comments came after questions about Meta’s takeover of Manus.
This reflects the background of Manus, which grew out of China’s startup scene before relocating to Singapore earlier this year. The company began as a product of Chinese startup Butterfly Effect, also known as Monica.Im, before becoming a separate business.
Manus came into the spotlight in March after launching an AI agent that could write detailed research reports and build custom websites. PYMNTS reported that the system used models from companies such as Anthropic and China’s Alibaba.
What Does Meta Gain From Buying Manus?
Meta bought Manus last month as it looks to strengthen AI tools across its consumer and business products. The company did not publish the price, though the Wall Street Journal reported that the deal exceeded $2 billion, citing people familiar with the transaction.
In a Dec. 29 announcement, Meta said Manus already serves millions of users and businesses. The company said the startup had processed more than 147 trillion tokens and created over 80 million virtual computers. Meta said it plans to scale the service to more customers.
Manus has also shown strong revenue growth. The company said it passed $100 million in annual recurring revenue in December, eight months after launching its product. Manus said this made it the fastest startup to reach that level from zero.
PYMNTS reported that the purchase gives Meta a working AI product that already generates subscription income. Meta’s AI revenue has mostly come through advertising and user engagement across its social platforms. Manus adds direct payments and data on how much people are willing to pay for AI services.
The startup said it had 105 employees in December, spread across Singapore, Tokyo and San Francisco. Manus said it will continue to operate from Singapore after the acquisition.
What Could Happen After This?
China’s review may take time. CNBC quoted Nick Patience, AI lead at The Futurum Group, who said China treats advanced AI agents and related intellectual property as strategic assets. He said approval could come with limits on how technology developed in China can be used.
Manus has already adjusted its operations as it looked overseas. The company reportedly laid off most of its staff in Beijing in July as it prepared for global growth. It later raised $75 million in April in a funding round led by US venture capital firm Benchmark.
For Meta, the deal fits into a much larger spending drive on AI. CNBC reported that the company invested $14.3 billion in June for a 49% stake in Scale AI. The investment brought founder Alexandr Wang into Meta’s leadership group.
Meta has also bought AI wearable startup Limitless and reshaped internal research teams to speed up product development. CNBC reported that chief executive Mark Zuckerberg has placed more weight on product focused AI work tied to Meta’s services.
CNBC said the Chinese investigation gives Beijing leverage over a high profile US led acquisition. For Meta, the process adds uncertainty around how quickly Manus technology can be rolled out across its platforms.
