Meta cuts Manus ties, blocks Singapore exit for Chinese AI

Meta has completed an operational separation from Manus, blocking Manus staff from its internal systems and stopping all data sharing as both firms work to unwind a roughly $2 billion acquisition that Chinese authorities ordered reversed in April. The company told employees last week to stop using Manus tools for internal projects and removed Manus access to internal data systems.

The acquisition was announced in December after Manus, built by parent company Butterfly Effect, relocated its legal headquarters and core teams to Singapore in mid-2025. Beijing’s April directive required the parties to begin reversing the deal and to sever technical links between the companies.

Beijing issued new outbound investment rules this month that take effect July 1 and expand government authority over overseas deals, including transactions involving Taiwan. The rules also allow penalties for foreign firms from countries that restrict Chinese investment. Officials and analysts view the new framework as covering restructurings that shift control or operations abroad.

Han Shen Lin, China managing director at The Asia Group, characterized the regulatory response as a clear limit on the practice some founders used to relocate companies to Singapore and raise foreign capital. Tilly Zhang, an industrial policy analyst at Gavekal Dragonomics, described Manus as a high-profile example Beijing did not want others to follow.

Meta’s operational cut removes Manus engineers’ access to code, internal tools and datasets while legal and technical teams work through disentanglement. Matthias Hendrichs, a Singapore-based adviser to global AI firms, warned that prior access to a buyer’s systems can create irreversible risks because engineers can see proprietary information even after repositories are removed.

Manus founders have held early talks to raise about $1 billion from external investors to buy the company back from Meta. That path could return the company to a Chinese joint-venture structure and lead to a listing in Hong Kong, where several AI firms have already debuted this year.

Legal teams and engineers at both companies must now separate code, cut data links and unwind personnel arrangements while complying with Beijing’s order. How quickly those tasks proceed will determine whether Manus can complete a sale to new investors, return to local ownership or pursue a public listing in Hong Kong.