Meta Platforms has announced it will fully unwind its $2 billion acquisition of the artificial intelligence startup Manus. This decision follows a move by Chinese regulators to block the transaction three months ago, citing national security concerns. The collapse of the deal marks a significant development in the ongoing technological decoupling between the United States and China, particularly within the sensitive sector of artificial intelligence development.

As part of the unwinding process, Manus notified its user base on Tuesday that it would begin deleting data generated by specific users on or after December 29. That date corresponds with the initial period when Meta had acquired the startup. The company stated that this data deletion is a necessary step in the transition as they move to undo the merger. While the deal was initially intended to bolster Meta’s AI capabilities, the intervention by Beijing has forced the tech giant to abandon the integration entirely. The situation highlights the increasing difficulty for major U.S. technology firms to acquire or integrate Chinese-founded assets amid heightened geopolitical tensions and strict regulatory oversight regarding data security and national interests.