China has blocked SoftBank Group's $5.4 billion acquisition of ABB's robotics division, dealing a sharp setback to founder Masayoshi Son's push into artificial intelligence-powered machines — and sending a clear signal that Beijing intends to keep its robotics edge at home.
ABB industrial robots. Photo: Dependability / Wikimedia Commons, CC BY-SA 4.0
ABB confirmed on Thursday that SoftBank had informed it that China's Office of the Working Mechanism for Foreign Investment Security Review had prohibited the acquisition of the ABB Robotics business in China. The decision was first reported by the Financial Times and was confirmed by ABB in a short statement.
The deal, agreed in October 2025 at an enterprise value of $5.375 billion, was meant to be the centrepiece of Son's bet on what he calls "physical AI" — robots powered by artificial intelligence. SoftBank had expected the transaction to close this year.
Why Beijing said no
The Chinese review was carried out by the National Development and Reform Commission, the state planner that vets foreign investment with possible national security implications. According to the Financial Times, citing people familiar with the matter, officials were concerned that robotics data could be transferred overseas and used to train AI models, including those built by OpenAI, in which SoftBank is a major investor.
SoftBank has invested about $64.6 billion in OpenAI for a stake of roughly 13 percent, according to the Wall Street Journal. The reported data concern has not been set out officially by Beijing, and China's planning agency did not immediately respond to requests for comment.
China is ABB's biggest robotics market, accounting for around 30 percent of its robot-related business, and ABB says it makes 90 percent of the robotics it sells in China locally. That made Chinese approval essential to the deal.
A blow to Son's AI ambitions
Son has billed robotics as a core part of SoftBank's AI investment strategy, alongside its huge OpenAI stake. The blocked deal is the second major transaction China has stopped this year: earlier in 2026, Beijing ordered Meta to unwind its acquisition of artificial intelligence startup Manus, worth more than $2 billion.
Investors reacted quickly. SoftBank shares fell about 6.8 percent in Tokyo on Thursday, while ABB shares were down about 1.1 percent in morning trading in Europe.
What happens next
ABB said it and SoftBank "are in close dialogue and working constructively on the transaction." The company's statement stopped short of declaring the deal dead, and the prohibition as worded covers the ABB Robotics business in China. The transaction is also understood to be under review by regulators in the United States and Europe.
SoftBank declined to comment. For Son, the setback comes as Japan and China trade sharp words over Taiwan, adding a diplomatic edge to a deal that was already a test of Beijing's willingness to let sensitive technology change hands.
Sources: Reuters, The Wall Street Journal, Financial Times, Nikkei Asia.