China is preparing to lift a travel restriction imposed on the co-founders of artificial intelligence startup Manus as the company moves to unwind its $2 billion acquisition by Meta. Manus CEO Xiao Hong and chief scientist Ji Yichao were restricted from leaving China after being summoned to Beijing earlier this year as Chinese regulators examined whether the sale to the US technology company violated investment rules.
The expected lifting of the restrictions comes as Manus prepares to return to independent ownership. Former investors including Tencent, ZhenFund and private equity firm HSG, along with members of management, are expected to buy back the company from Meta at roughly its previous $2 billion valuation. Tencent is expected to become Manus’s largest shareholder, although it will hold only a minority stake, allowing Manus to continue operating independently from Singapore.
China Prepares to Lift Travel Restrictions
Beijing is expected to soon remove the travel restrictions imposed on Manus’s founders as the regulatory review surrounding the Meta transaction moves toward resolution.
Xiao Hong recently told employees that he planned to return to Singapore, where Manus is headquartered, according to people familiar with the matter.
The restrictions were imposed after Xiao and Ji were summoned to Beijing in March for discussions with China’s National Development and Reform Commission (NDRC).
| Key Detail | Information |
|---|---|
| Company | Manus |
| CEO and co-founder | Xiao Hong |
| Chief scientist and co-founder | Ji Yichao |
| Acquirer | Meta |
| Original acquisition value | About $2 billion |
| Current plan | Unwind Meta acquisition |
| Expected new largest shareholder | Tencent |
| Manus headquarters | Singapore |
| Travel restriction | Expected to be lifted |
| Chinese regulator involved | National Development and Reform Commission |
The expected lifting of the travel ban suggests Beijing’s investigation could be moving toward a resolution following the decision to unwind the transaction.
Why Were the Manus Founders Restricted?
The travel restrictions were linked to China’s review of Meta’s acquisition of Manus.
Chinese authorities examined whether the transaction complied with the country’s investment rules.
The founders were allowed to travel within China but were prevented from leaving the country while the review was underway.
Regulatory Review
Meta acquires Manus
↓
Chinese authorities review transaction
↓
Founders summoned to Beijing
↓
Travel restrictions imposed
↓
Regulatory investigation
↓
Meta acquisition ordered to unwind
↓
Manus returns toward independence
↓
Travel restrictions expected to end
The case illustrates the increasing scrutiny that Chinese authorities are applying to transactions involving strategically important technology companies.
Meta’s $2 Billion Manus Deal Is Being Unwound
Meta acquired Manus in December 2025 in a transaction that valued the AI startup at roughly $2 billion.
The acquisition was intended to strengthen Meta’s artificial intelligence capabilities, particularly in the rapidly developing field of AI agents.
Meta moved quickly to integrate Manus technology into its own systems after completing the acquisition.
However, Chinese regulators subsequently intervened.
Manus Acquisition Timeline
December 2025
↓
Meta acquires Manus
↓
March 2026
↓
Founders summoned to Beijing
↓
Travel restrictions imposed
↓
April 2026
↓
China blocks the takeover
↓
Meta begins unwinding the transaction
↓
August 2026
↓
Manus announces return to independence
↓
Founders expected to regain ability to travel
The unwinding process represents a major reversal of Meta’s original strategy for Manus.
Manus Is Returning to Independent Ownership
Manus announced this week that it would return to operating as an independent business.
The company said the separation from Meta was necessary to comply with regulatory requirements in certain parts of the world.
The new ownership group is expected to include several of Manus’s former investors as well as members of management.
New Manus Ownership Structure
Former Manus investors
+
Tencent
+
ZhenFund
+
HSG
+
Management
↓
Buy back Manus
↓
Approximately $2 billion valuation
↓
Manus becomes independent
↓
Singapore-based operations continue
The arrangement would effectively reverse the Meta acquisition while preserving Manus’s existing business.
Tencent Is Expected to Become the Largest Shareholder
Tencent is expected to become Manus’s largest shareholder following the buyback.
However, Tencent will hold a minority stake rather than taking full control of the company.
This structure would allow Manus to remain an independent business rather than becoming part of Tencent’s broader corporate structure.
Proposed Ownership Model
Tencent
↓
Largest shareholder
↓
Minority stake
+
Other investors
+
Management
↓
Independent Manus
↓
Singapore operations
The structure could allow Manus to retain greater operational independence while bringing back some of its original financial backers.
Manus Will Continue Operating From Singapore
Although Manus was founded in China, the company moved its headquarters and core engineering team to Singapore before the Meta acquisition.
The company is expected to continue operating from Singapore after the transaction is unwound.
This makes the case particularly significant because it demonstrates that moving a technology company’s headquarters overseas does not necessarily remove it from Chinese regulatory oversight.
Manus’s Geographic Evolution
China
↓
Manus founded
↓
Singapore
↓
Headquarters and core engineers moved
↓
Meta acquisition
↓
China regulatory intervention
↓
Acquisition unwound
↓
Independent Singapore-based Manus
The development could have implications for other Chinese technology startups seeking overseas structures.
Beijing’s Intervention Sends a Message to Chinese Startups
The Manus case could serve as a warning to Chinese technology companies considering overseas acquisitions.
Manus had moved its headquarters and core engineering operations to Singapore before being acquired by Meta.
Despite the company’s overseas structure, Chinese regulators still intervened in the transaction.
Strategic Message
Chinese technology startup
↓
Moves headquarters overseas
↓
Seeks foreign acquisition
↓
Chinese authorities review transaction
↓
Potential regulatory intervention
↓
Foreign acquisition may be blocked
The case suggests that Beijing wants to retain oversight of strategically important technology and intellectual property even when companies establish overseas operations.
AI Agents Are Becoming Strategically Important
Manus is an AI-agent company focused on systems capable of performing tasks with relatively limited human intervention.
Unlike conventional chatbots, AI agents are designed to carry out multi-step tasks, use tools and execute workflows.
AI Agent Model
User instruction
↓
AI agent
↓
Understand task
↓
Plan steps
↓
Use tools
↓
Execute actions
↓
Deliver result
This technology is becoming strategically important because AI agents could automate significant portions of knowledge work.
Why China Is Paying Attention to Agentic AI
AI agents combine artificial intelligence models with software tools, data access and autonomous decision-making.
This makes the technology potentially important for areas including business automation, research, coding, finance and enterprise operations.
Agentic AI Applications
Research
+
Software development
+
Business automation
+
Data analysis
+
Planning
+
Digital services
↓
AI agents
↓
Automated knowledge work
The strategic value of this technology may explain the level of regulatory attention surrounding Manus.
Manus Was Compared With DeepSeek
Manus attracted significant international attention after launching its AI-agent platform.
The company was sometimes described as a Chinese counterpart to DeepSeek because of the attention it received in global AI circles.
Its technology was promoted as capable of performing complex tasks such as research, programming and planning with relatively limited human intervention.
The Meta acquisition subsequently turned Manus into one of the most closely watched AI startup transactions involving a China-linked company.
Manus Continued Developing Its Platform During the Investigation
Despite the regulatory investigation, Manus continued to develop and update its AI platform.
The company is expected to launch a new version of its platform after the acquisition unwinding is completed.
According to people familiar with the matter, Manus remains on track to release its next major version.
Manus Development
Regulatory investigation
↓
Operations continue
↓
Platform development
↓
New product development
↓
Manus 2.0
↓
Independent AI company
The continued development suggests that the regulatory dispute has not halted the company’s underlying technology programme.
Manus Expects More Than $300 Million in Annual Recurring Revenue
Manus is expected to maintain annual recurring revenue above $300 million after separating from Meta, according to people familiar with the company’s plans.
That would make the startup significantly more commercially mature than many early-stage AI companies.
Manus Business Outlook
Independent company
↓
AI-agent platform
↓
Enterprise and consumer usage
↓
Recurring revenue
↓
$300 million+ expected ARR
The revenue outlook could make the company attractive to its returning investors despite the collapse of the Meta deal.
The Unwinding Still Requires Regulatory Approval
The buyback arrangement is not simply a private transaction between investors.
The unwinding process requires final approval from Chinese regulators led by the National Development and Reform Commission.
The NDRC previously blocked the Meta takeover in April.
Regulatory Process
Manus + Meta
↓
Acquisition
↓
Chinese regulatory review
↓
NDRC blocks transaction
↓
Separation process
↓
Investor buyback
↓
Regulatory approval
↓
Independent Manus
The final approval remains an important step before the restructuring is complete.
Meta Has Started Separating Manus
After Chinese authorities ordered the acquisition to be unwound, Meta began separating Manus operations from its own systems.
The companies also stopped sharing data as part of the separation process.
This is particularly significant for an AI company because data, models, computing infrastructure and software systems are closely connected.
Separation Process
Meta
↓
Manus acquisition
↓
Technology integration
↓
Chinese intervention
↓
Data sharing stopped
↓
Systems separated
↓
Manus returns to independence
The separation could be technically complex because Meta had already begun integrating Manus into its AI operations.
The Case Highlights China’s AI Policy
The Manus episode reflects China’s broader effort to strengthen control over strategically important technology.
At the same time, Beijing has continued to encourage AI companies and entrepreneurs to develop products and compete internationally.
The policy therefore combines support for innovation with greater regulatory oversight.
China’s AI Approach
Encourage innovation
+
Develop AI companies
+
Support domestic technology
BUT
↓
Control strategic technology
+
Review foreign acquisitions
+
Protect sensitive intellectual property
↓
Greater regulatory oversight
The Manus case demonstrates this balance.
China Could Tighten Controls on Agentic AI Exports
The Financial Times has previously reported that Beijing was considering adding agentic AI to an updated export-control list.
If implemented, such measures could place additional restrictions on the transfer of advanced AI-agent technology outside China.
Potential Export-Control Framework
Agentic AI technology
↓
Strategic importance
↓
Export-control review
↓
Potential restrictions
↓
Greater domestic oversight
Such controls could affect future international transactions involving Chinese AI startups.
The Case Could Affect Future Foreign Acquisitions
Foreign companies seeking to acquire Chinese technology startups could face greater scrutiny, particularly when the businesses possess advanced AI capabilities.
This could increase regulatory uncertainty around cross-border technology deals.
Cross-Border AI Deal
Chinese AI startup
↓
Foreign acquisition offer
↓
Investment review
↓
Technology assessment
↓
National-security considerations
↓
Regulatory approval or rejection
The Manus transaction demonstrates the potential complexity of these deals.
Overseas Headquarters May Not Eliminate Regulatory Exposure
One of the most important lessons from the Manus case is that corporate headquarters and regulatory jurisdiction can be different questions.
Manus moved its headquarters to Singapore and relocated core engineers, but Chinese authorities still reviewed the acquisition.
Global Structure
Chinese-founded company
↓
Singapore headquarters
↓
Global operations
↓
Foreign acquisition
↓
Chinese regulatory review
This could influence how other Chinese-founded technology companies structure international operations.
US-China Technology Competition Is Another Factor
The Manus case also takes place against a broader backdrop of competition between China and the United States over advanced technology.
AI has become a strategically important area for both countries.
US-China AI Competition
China
↓
AI models
+
AI agents
+
Semiconductors
+
Technology companies
VS
United States
↓
AI models
+
Cloud infrastructure
+
AI chips
+
Technology companies
↓
Strategic technology competition
Cross-border acquisitions of advanced AI companies therefore face greater scrutiny than ordinary technology transactions.
The Case Could Encourage More Domestic AI Investment
If foreign acquisitions of Chinese AI startups become harder, domestic investors may have a larger role in financing the sector.
The Manus buyback already demonstrates how existing Chinese investors can step in to provide capital and ownership.
Domestic Funding Model
Foreign acquisition
↓
Regulatory barriers
↓
Existing investors
↓
Tencent + ZhenFund + HSG + Management
↓
Buyback
↓
Independent company
This could become a more common model for strategically sensitive technology companies.
Manus’s Future Depends on Independent Growth
The company now needs to demonstrate that it can continue growing without Meta’s resources.
Meta provided access to substantial capital, computing infrastructure, engineering resources and a global distribution ecosystem.
Manus will need to maintain its growth trajectory as an independent company.
Independent Manus
Technology
+
Talent
+
Investors
+
Revenue
+
Computing infrastructure
↓
Independent growth
↓
New products
↓
Manus 2.0
↓
Global AI-agent business
Its expected $300 million-plus annual recurring revenue provides a strong starting point, but competition in AI agents is becoming increasingly intense.
AI Agent Competition Is Growing
Manus is competing in a market that includes major technology companies and AI startups.
Companies around the world are developing agents capable of researching information, writing software, interacting with applications and automating business processes.
AI Agent Competition
Manus
+
OpenAI
+
+
Anthropic
+
Other AI startups
↓
AI agent market
↓
Automation of knowledge work
The ability to build reliable, scalable agents will determine which companies capture long-term market share.
What It Means for Manus
For Manus, the end of the travel restrictions could mark the beginning of a new phase.
The company will have to transition from being a Meta acquisition target to an independent global AI company.
Key priorities will likely include:
- Completing the ownership restructuring
- Securing regulatory approvals
- Launching Manus 2.0
- Maintaining revenue growth
- Retaining engineering talent
- Expanding internationally
- Competing with major AI companies
What It Means for Meta
For Meta, unwinding the Manus acquisition means giving up a major AI acquisition that was intended to strengthen its agentic-AI capabilities.
The company will need to continue developing AI agents internally and through other partnerships and investments.
The separation also illustrates the challenges US technology companies can face when acquiring China-linked AI businesses.
What It Means for Tencent
Tencent’s expected position as Manus’s largest shareholder could give it exposure to one of the more prominent AI-agent companies in the market.
However, its minority position means Manus would remain operationally independent.
The investment could provide Tencent with strategic exposure to agentic AI without requiring it to fully integrate Manus.
What It Means for China’s AI Industry
The Manus case could encourage Chinese AI companies to focus more heavily on domestic ownership and financing.
It could also lead companies to think more carefully about how they structure international operations and intellectual-property ownership.
China’s Emerging AI Model
Domestic capital
+
Domestic AI development
+
Global operations
+
Regulatory oversight
↓
Internationally competitive AI companies
The balance between global expansion and domestic regulatory requirements will become increasingly important.
What Investors Should Watch
Investors and technology companies should monitor several developments following the expected lifting of the travel restrictions.
Key areas include:
- Final approval of the Meta-Manus unwinding
- Completion of the investor buyback
- Tencent’s final ownership stake
- Manus 2.0 launch
- Annual recurring revenue
- New international customers
- China’s AI export-control policies
- Future cross-border AI acquisitions
- Manus’s relationship with Singapore
Manus Watchlist
Regulatory approval
↓
Ownership restructuring
↓
Founder travel restrictions lifted
↓
Manus independence
↓
Manus 2.0
↓
Revenue growth
↓
International expansion
The company’s ability to execute after separating from Meta will be the most important indicator of its long-term prospects.
Key Numbers at a Glance
| Metric | Detail |
|---|---|
| Meta-Manus deal value | About $2 billion |
| Expected Manus ARR | More than $300 million |
| Expected largest shareholder | Tencent |
| Tencent ownership | Minority stake |
| Manus headquarters | Singapore |
| Founders under travel restrictions | 2 |
| Acquisition announced | December 2025 |
| NDRC blocked takeover | April 2026 |
| Expected status | Manus returning to independence |
Infographic: The Manus Acquisition Reversal
MANUS FOUNDED IN CHINA
↓
HEADQUARTERS MOVED TO SINGAPORE
↓
META ACQUIRES MANUS
↓
ABOUT $2 BILLION
↓
CHINA REVIEWS TRANSACTION
↓
FOUNDERS RESTRICTED FROM LEAVING CHINA
↓
NDRC BLOCKS TAKEOVER
↓
META UNWINDS ACQUISITION
↓
FORMER INVESTORS BUY BACK MANUS
↓
TENCENT BECOMES LARGEST MINORITY SHAREHOLDER
↓
MANUS RETURNS TO INDEPENDENCE
↓
FOUNDERS EXPECTED TO RETURN TO SINGAPORE
The Bigger Picture
The Manus episode highlights the increasingly complicated intersection of artificial intelligence, national security, investment regulation and cross-border technology transactions. A startup that moved its headquarters and engineering operations to Singapore was still subject to Chinese regulatory scrutiny when a US technology company attempted to acquire it. The subsequent decision to unwind the transaction demonstrates that Beijing is prepared to intervene when it considers advanced AI technology strategically important.
For Manus, the immediate challenge is to complete the restructuring and rebuild its independent growth strategy. The company retains a significant AI-agent business, expects annual recurring revenue above $300 million and is preparing its next major product release. For the wider industry, however, the case could have a much broader impact. Chinese AI startups may face greater scrutiny when seeking foreign buyers, while global technology companies may become more cautious about acquisitions involving strategically sensitive Chinese technology.
Looking Ahead
China’s expected decision to lift the travel restrictions on Manus co-founders Xiao Hong and Ji Yichao comes as the AI startup prepares to unwind its roughly $2 billion acquisition by Meta and return to independent ownership. The founders had been restricted from leaving China after being summoned to Beijing during a regulatory investigation into the transaction. The expected removal of the restrictions suggests that the process may be moving toward resolution, although final regulatory approvals are still required. Former investors including Tencent, ZhenFund and HSG, along with management, are expected to buy back the company, with Tencent becoming its largest shareholder while retaining only a minority stake.
The outcome will be closely watched by the global AI industry because it demonstrates how geopolitical and regulatory considerations can influence cross-border technology deals. Manus is expected to continue operating from Singapore, launch its next major platform version and maintain annual recurring revenue above $300 million. At the same time, Beijing may tighten oversight of agentic AI exports and future foreign acquisitions of Chinese AI companies. The Manus case could therefore become an important precedent for how China balances the international expansion of its AI startups with its desire to retain control over strategically important technology.
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