Chinese tech giant Tencent is in talks to acquire a majority stake in AI agent startup Manus, according to the Financial Times, after Beijing forced Meta to unwind its $2 billion acquisition of the company. Tencent sees overlap with its own AI agent strategy, including plans to embed an agent into WeChat.

Most earlier investors, including Tencent, ZhenFund, and HSG, plus the management team, are discussing a deal at the same $2 billion valuation. U.S. firm Benchmark is not expected to take part. Manus will keep operating independently out of Singapore and most recently reported annual revenue of close to $500 million.

China blocked Meta's Manus acquisition in April, calling it a violation of investment rules, and imposed an exit ban on founder Xiao Hong. Officials described the deal as a "conspiratorial" attempt to undermine China's tech base and banned foreign investment in Manus. The decision fits into a broader AI arms race between the two countries, where the technology is already being compared to "cyber-nuclear weapons of the AI era" given recent advances in AI-driven cybersecurity attacks.