China blocks SoftBank’s $5.4 billion ABB robotics deal: How Beijing is tightening its grip on strategic technologies
China has blocked Japanese investment giant SoftBank's proposed $5.4 billion acquisition of the robotics business of Swiss engineering group ABB, highlighting Beijing's growing scrutiny of foreign investments in strategically important technology sectors.
ABB said on Thursday that China's state planner had prohibited the transaction, Reuters reported.
The move marks the second major foreign acquisition blocked by Beijing this year, following its intervention in Meta Platforms' more than $2 billion acquisition of Chinese artificial intelligence start-up Manus.
The decision also deals a setback to SoftBank's ambitions in robotics, which CEO Masayoshi Son has identified as a key part of the Japanese group's broader AI investment strategy.
According to the Financial Times, China's National Development and Reform Commission (NDRC) informed SoftBank last week that the acquisition could not proceed. The regulator is responsible for reviewing foreign investments that could have national security implications.
The NDRC was reportedly concerned that data generated by ABB's robotics operations in China could be transferred overseas and used to train AI models, including those developed by OpenAI, in which SoftBank is a major investor.
ABB said it remained in close dialogue with SoftBank and that both companies had been working on the transaction.
China's concerns reportedly centre on the transfer of sensitive industrial data and the possibility of it being accessed and used outside the country.
Industrial robots collect and process large amounts of operational data while performing tasks in factories and manufacturing facilities.
This information can help improve AI systems, particularly in the emerging field of physical AI, which combines artificial intelligence with machines and robots capable of performing tasks in the real world.
The NDRC was reportedly concerned that data generated through ABB's Chinese operations could move overseas and be used to train AI models.
The decision reflects Beijing's growing emphasis on controlling access to technologies and data that it considers strategically important.
Robotics, advanced manufacturing and AI have become increasingly significant areas of competition between China and other major economies.
China is ABB's largest robotics market, accounting for around 30% of its robot-related business, according to Reuters.
The Swiss engineering group has a substantial presence in the country, operating around 30 local companies and employing approximately 15,000 people across nearly 130 cities. Its online and offline sales channels cover nearly 700 cities.
ABB Engineering (Shanghai) houses the company's global robotics headquarters and serves as an important research and development centre and manufacturing base.
This extensive presence makes China a crucial market for ABB's robotics business. It also means that any change in ownership involving the division could have implications for its operations, technology and data generated in the country.
The blocked acquisition is a setback for SoftBank's efforts to expand its presence in robotics and strengthen its position in the global AI industry.
CEO Masayoshi Son has made robotics a central part of the group's long-term AI strategy. Acquiring ABB's robotics business was expected to give SoftBank access to established industrial robotics technology and strengthen its capabilities in automation.
The deal was announced in October last year as part of the Japanese group's broader push to invest in AI-related businesses.
The Chinese regulator's intervention now complicates SoftBank's plans to combine robotics technology with its wider AI investments, particularly as the company seeks to expand beyond conventional software-based AI applications.
The decision comes amid a broader effort by Beijing to retain control over strategically important technologies, intellectual property and industrial data.
Earlier this year, China intervened in Meta's proposed acquisition of Manus, a Chinese-founded AI start-up, worth more than $2 billion.
The company was subsequently ordered to unwind the transaction, highlighting the regulatory hurdles foreign companies can face when attempting to acquire Chinese-origin technology businesses.
Beijing has also proposed tighter export controls on advanced technologies.
On October 16, China's Ministry of Commerce and Ministry of Science and Technology proposed adding 40 technologies to its catalogue of technologies prohibited or restricted from export.
Of these, 23 are related to AI, including technologies involving AI models, intelligent agents and computing clusters. The proposed changes cover sectors including artificial intelligence, biomedicine and solar manufacturing.
These measures reflect China's efforts to strengthen oversight of technologies and capabilities it considers important to national security and economic competitiveness.
With inputs from Reuters.
Bhanu Pratap is a journalist who reports and writes on foreign affairs, India’s foreign policy, geopolitics and strategic affairs. He closely follows diplomatic developments in New Delhi and has a keen interest in defence and national security.<br> <br> Bhanu also focuses on in-depth, interview-based reports and regularly speaking with experts and policymakers to bring perspectives and context to major developments around the world.<br> <br> He is also interested in stories with strong humanitarian angles.<br><br> One such report examined the cases of Indian nationals who were allegedly recruited and forced into Russia’s war against Ukraine. While reporting the story, Bhanu spoke to the families of those affected and documented their experiences. The report was later taken into account by the United Nations in its findings on human rights violations linked to the war in Ukraine.<br> <br> For Bhanu, the zeal to produce meaningful and impactful journalism remains at the heart of his work.<br> <br>He has previously worked with Firstpost, NDTV, Newslaundry and Republic.<br><br> Bhanu studied at the Delhi School of Journalism, University of Delhi. He initially chose science with plans to pursue engineering, influenced by conventional expectations, but fate had other plans and eventually led him to journalism.<br><br> Beyond the newsroom, Bhanu enjoys exploring culture and history and often spends his days off on heritage walks. He is also passionate about travelling, biking and listening to folk music.<br> <br>For tips, reviews and suggestions, you can reach him at bhanu.pratap@htdigital.in.
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