China blocks SoftBank’s $5.4 billion takeover of ABB’s robotics division, FT reports (updated)

Softbank

Today 03:51

Adds context details in bullet points 4-5 and Softbank declined to comment in bullet point 8
Nov 5 (Reuters) - China has told Japanese investor SoftBank 9984.T it will not allow the $5.4 billion acquisition of the robotics segment of Swiss engineering group ABB ABBN.S to go ahead, the Financial Times reported on Thursday, citing multiple people familiar with the matter. 
Here are some details:
China's state planner, the National Development and Reform Commission (NDRC), would block the deal, the report said.
SoftBank had agreed to buy ABB's robotics business in October last year, as CEO Masayoshi Son sought to establish SoftBank as a core player in the development of artificial intelligence.
SoftBank had expected the deal to be approved until last week, the newspaper said.
The NDRC reviews foreign investment in the country that might have national security implications. Earlier this year, the NDRC ordered US tech giant Meta (META.O) to unwind its $2 billion-plus acquisition of artificial intelligence startup Manus, as Beijing tightens scrutiny of US investment in domestic startups developing frontier technologies.
China is ABB's biggest robots market, representing around 30% of its robots business. ABB operates around 30 local companies in China with about 15,000 employees located in nearly 130 cities and online and offline channels in nearly 700 cities. According to its website, ABB Engineering (Shanghai) Ltd is home to its global robotics headquarters, as well as an important robotics research and development center and production base for ABB Group.
The NDRC was concerned about robotics data being transferred overseas, where it could be used to train AI models, including those developed by OpenAI, in which SoftBank is a major investor, the FT report added.
SoftBank shares, already down about 5% in Tokyo, were little changed after the FT report.
Reuters could not immediately verify the report. SoftBank declined to comment. ABB did not respond to Reuters' requests for comment. China's NDRC could not be reached.
     

 (Reporting by Sumedha Mukherjee in Bengaluru, Anton Bridge in Tokyo and Kane Wu in Hong Kong; Editing by Mrigank Dhaniwala, Jochelle Mendonca and Christian Schmollinger)
 ((Sumedha.Mukherjee2@thomsonreuters.com))