$1 billion investment and IPO: How Manus creators are trying to cancel a major deal with Meta

The creators of the Chinese startup Manus, which develops universal AI agents, are looking for a way to comply with Chinese authorities and cancel - partially or fully - the deal with Meta for more than $2 billion, Bloomberg reports, citing sources familiar with the situation.

Manus Meta agreed to acquire Manus in late December, but nearly six months later, China blocked the agreement and demanded that it be canceled.

Among the options that would allow Manus to terminate the deal with Meta and buy the business from the American corporation, the three founders of the AI startup - Xiao Hong, Ji Yichao and Zhang Tao - are considering a large round of financing, Bloomberg notes, citing sources. They were forced to take this step by the requirement of China's National Development and Reform Commission, which on April 27 ordered to cancel the purchase of Meta Manus. Now the co-founders of the company, according to Bloomberg sources, are negotiating about $1 billion in external investments, based on the business valuation of at least $2 billion (approximately how much Meta paid for the purchase of Manus), and the rest of the amount - ready to pay from their own funds.

If the founders' idea to raise funds succeeds, the next step will be the restructuring of Manus. A Chinese joint venture with new investors will be created on the basis of the startup, after which Manus plans to launch an IPO in Hong Kong, one of the Bloomberg interlocutors said.

Cancellation of such a large deal a few months after its completion is actually an unprecedented case, Bloomberg adds. Nevertheless, some investors have expressed interest in participating in the buyback, as Manus was expected to generate about $1 billion in revenue this year, the sources said.

However, these plans remain tentative for now, with discussions on the Manus valuation continuing. There are still obstacles on the way to the realization of the canceled deal, Bloomberg's interlocutors say. In particular, it is unclear how the new owners will be able to separate Manus' agent AI technology, most of which is already integrated into Meta's systems.

What other options the Manus co-founders are considering to partially or fully cancel their agreement with Meta, the agency's sources did not say.

Meta representatives declined to comment. A representative of Manus did not promptly respond to the journalists' request.

The startup Manus was launched in March 2025. It is a universal AI agent capable of automating complex digital tasks: from analyzing the S&P 500 stock index to making trade proposals. According to the company's data, eight months after its launch, its annual revenue exceeded $100 million. Meta paid attention to the success of Manus - in December last year, the American corporation completed the takeover of the AI startup.

The agreement between the companies has raised serious concerns in the PRC due to the leakage of technology and talent to the US company, Bloomberg recalls. Although Manus was incorporated in Singapore, its founders are from China, and early versions of Manus were created by engineers at Beijing Butterfly Effect Technology, which was founded in the PRC in 2022, The Wall Street Journal wrote. Manus has been working to shut down that company in China, but has not finalized the process. Meta said after the deal that Manus' Chinese owners would have no stake in the company and that the startup would cease operations in China.

This article was AI-translated and verified by a human editor