China Blocks SoftBank's $5.4 Billion Purchase of ABB's Robotics Unit, ABB Says

A Chinese government agency has prohibited SoftBank Group's $5.4 billion acquisition of ABB's robotics business, ABB said in a statement on Thursday, Nov. 5. The Swiss-Swedish conglomerate named China's Office of the Working Mechanism for Foreign Investment Security Review as the body that issued the prohibition.

SoftBank declined to comment. China's National Development and Reform Commission, the state planner that runs the security review, did not immediately respond to a request for comment.

What was blocked

SoftBank agreed in October 2025 to buy 100% of ABB Robotics for about $5.375 billion, with completion planned for mid-to-late 2026. The European Commission cleared the deal without conditions in March. Approvals from China and the United States were still pending as of late October.

The unit generated about $2.3 billion in revenue in 2024, roughly 7% of ABB's group total. It has more than 7,000 employees and sells robotic arms and industrial machinery to manufacturers such as BMW.

China is the issue because it is the customer. The country is ABB's biggest robotics market, around 30% of its robot-related business. ABB runs about 30 local companies there with roughly 15,000 employees, and its global robotics headquarters is in Shanghai.

Why Beijing said no

China has not publicly explained the decision. The Financial Times, citing multiple people familiar with the matter, reported that the NDRC was worried about robotics data moving overseas, where it could be used to train AI models, including those developed by OpenAI. SoftBank has a near-$65 billion bet on OpenAI.

The FT also reported that SoftBank expected approval until it was told last week of the prohibition. SoftBank is now trying to work out what went wrong and whether it can reapply, according to the paper.

This fits a pattern. In April, the NDRC blocked Meta Platforms' $2 billion-plus acquisition of AI startup Manus with a one-line notice saying it had decided to prohibit foreign investment in the startup "in accordance with laws and regulations." Meta was ordered to unwind the deal.

Beijing has also clamped down this year on the transfer of vital data abroad. In robotics, data is central to making machines work in the real world.

The markets and the money

SoftBank shares closed down 6.8% in Tokyo on Thursday. They were already down about 5% before the FT report appeared, so the whole drop cannot be pinned on the ABB news. One market note tied the earlier slide to Arm Holdings' underwhelming guidance for the current quarter and a broader selloff in AI-linked stocks.

ABB shares were down 1.1% in morning trading after the block became public.

Founder Masayoshi Son has made physical AI, meaning AI paired with machines that act in the physical world, a centerpiece of his strategy. Investors already uneasy about his OpenAI stake and pledges of hundreds of billions of dollars on data center projects had looked to ABB's earnings contribution as reassurance.

"ABB Robotics lacks the cutting-edge innovation found across SoftBank's physical AI startup portfolio, but its domain expertise and manufacturing knowhow had been expected to transform robotic concepts into actual businesses," said Bloomberg Intelligence analyst Kirk Boodry.

Not necessarily over

ABB is not treating the deal as dead. The company said it and SoftBank are in close dialogue and working on the transaction. What a revised path would look like has not been disclosed. If the deal does collapse, ABB keeps a business that stays on its books, and it would have to decide what to do with it.

Beijing's view, so far, rests on past practice rather than a statement. In the Manus case it cited only its legal authority. The NDRC reviews foreign investments that might have national security implications, and Chinese officials have framed tighter control of data as a security matter.

Other pressure on SoftBank

Less than a week before the ABB ruling, SoftBank-backed payments company OPay withdrew a U.S. initial public offering. It cited a regulatory inquiry by a foreign jurisdiction it did not identify. The offering had priced 16 million American depositary shares at $19 each, which would have raised $304 million. No one has linked that withdrawal to the ABB decision.

China and Japan are also in a diplomatic dispute that began after Japanese Prime Minister Sanae Takaichi's comments on Taiwan in November 2025. Beijing responded by severely limiting exports of critical minerals to Japan. No source has tied that dispute to the ABB decision.

It is unclear whether a renewed application or a restructured deal can get through Beijing. SoftBank has not said whether it will try, and U.S. approval was still pending as of late October.