Foreign investors will likely be scared off after Beijing blocked Meta’s $2 billion acquisition of an AI startup based in Singapore, analysts say.
Before Beijing formally blocked Meta’s roughly $2 billion acquisition of the AI startup Manus, it first made sure the company’s two top executives couldn’t leave the country.
In March, Chinese authorities summoned Manus CEO Xiao Hong and chief scientist Ji Yichao to a meeting in Beijing. Both men were based in Singapore, where Manus had moved its headquarters nine months earlier. They were questioned by officials from the National Development and Reform Commission (NDRC) over what regulators framed as possible violations of foreign investment reporting rules.
After the meeting, they were told they could not leave mainland China, a development the Financial Times first reported on March 25, citing people familiar with the matter.
A month later, on April 27, the NDRC ordered Meta to reverse the acquisition—a process that involved disentangling rights, capital, and intellectual property—within several weeks.
When asked by the AFP news agency about the decision to block the deal and bar Manus’s cofounders from leaving the country, Chinese Foreign Ministry spokesman Lin Jian said that Beijing only reviews foreign investment “in accordance with laws and regulations.”
The case is without precedent. It is the first time Beijing has used exit bans on company executives to derail a multibillion-dollar foreign tech acquisition, and the first publicly blocked foreign deal under China’s 2021 foreign investment security review system.
Analysts told The Epoch Times that it marks a striking expansion of how far the Chinese Communist Party (CCP) is willing to go to stop technology, capital, and talent it considers strategically important from leaving its grasp—even when the target is, on paper, a Singapore-incorporated company with no remaining Chinese ownership.
They say the chilling effect is likely to ripple across China’s AI industry, scaring off foreign investors, closing exit options, and pushing some of the country’s most ambitious entrepreneurs to build outside China from day one—or to leave earlier than they otherwise would.
By Sean Tseng
