China blocks SoftBank's $5.4 billion deal for ABB Robotics

ABB said SoftBank told it that China's Office of the Working Mechanism for Foreign Investment Security Review has prohibited the acquisition of the ABB Robotics business in China. That is a government office that checks whether foreign deals could hurt national security.

SoftBank manages the process of getting the deal's approvals. Those approvals are still outstanding, along with the usual closing conditions.

ABB also said it and SoftBank "are in close dialogue and are working constructively on the transaction." In plain words, nobody has walked away.

In real life Think of buying a restaurant chain that has a big branch in another country. The city can say you may not take over that branch, even if the rest of the sale goes through.

ABB and SoftBank signed the agreement on October 8, 2025. Here are the main terms:

• Price: $5.375 billion, counted as the enterprise value (the value of the business, including its debt).
• Structure: ABB would move the robot business into a new holding company, and a SoftBank subsidiary would buy all of its shares.
• Timing: closing was expected in mid-to-late 2026, once the European Union, China and the United States approved it.
• Cash for ABB: about $5.3 billion after transaction costs, plus an accounting gain of about $2.4 billion before tax.

ABB also expected costs from the split. It put separation costs at about $200 million and cash tax payments at $400 million to $500 million. Those numbers show how much work had already gone into the sale.

The sale replaced an earlier plan. In April 2025, ABB had said it would list the robot unit as its own company in 2026. The sale scrapped that listing.

ABB chairman Peter Voser said at the time that the board weighed SoftBank's offer against the spin-off. He said the sale created value for shareholders right away.

ABB Robotics builds industrial robots, the big mechanical arms that weld car frames and place parts on electronic boards. The unit has about 7,000 employees and made $2.3 billion in 2024. That is about 7% of everything ABB earns.

ABB said the robot unit had few business and technology overlaps with the rest of the company. It also serves customers who buy in different ways. That helped explain why ABB was happy to let it go.

China is a major market for ABB Robotics, and the company is deeply rooted there. It builds about 90% of the robots it sells to Chinese customers inside China.

Its factory in Shanghai cost $150 million and opened in December 2022. The site covers about 67,000 square meters and includes an 8,000 square meter research center. The center works on AI, machine vision (software that lets machines see) and robot software.

The business is also growing there. ABB Robotics saw a 32% rise in business in China in the third quarter of 2026. China accounts for roughly 30% of the robot unit, so approval from Beijing mattered a great deal.

Why it matters: if a buyer takes over the whole company, the Chinese part comes along with it. Chinese authorities clearly did not want that to happen without conditions.

China has not published its reasons. The Financial Times, which first reported the block, said regulators were worried about robot technology and data collected in China moving overseas.

The paper said the fear was that the data could be used to train AI models. It named OpenAI as an example of an overseas company that SoftBank invests in. These reasons were not confirmed by Chinese authorities or by the companies.

The same report said the review had floated conditions. One was selling parts of the robot business to Chinese owners. Another was keeping some intellectual property (the rights to the technology) inside China.

Treat these details as reported, not confirmed. ABB's statement only says the acquisition in China was prohibited.

It would not be the first time. In April, China's National Development and Reform Commission ordered Meta and the AI startup Manus to unwind a deal worth more than $2 billion. Manus was started in China and later moved to Singapore.

Governments elsewhere are also tightening rules on robots:

• United States: last week, President Trump said the commerce secretary had sent him a Section 232 report on how imports of robots and industrial machines affect national security. That kind of report can lead to tariffs.
• Humanoids and quadrupeds: the report singled out advanced robots, including humanoid and four-legged robots, as direct support for the US military.
• FCC: the US Federal Communications Commission has banned new foreign-made advanced robotic devices, including mobile robots such as humanoids and quadrupeds.

Robots are moving from factory floors into national security lists. Deals that move robot data and know-how across borders now get a very close look.

SoftBank chairman and CEO Masayoshi Son said the deal was about the company's "next frontier," which he called Physical AI. He described it as fusing artificial super intelligence with robotics.

SoftBank wanted to pair ABB Robotics' factory footprint and customers with its other robot holdings. Those include SoftBank Robotics Group, Berkshire Grey, AutoStore, Agile Robots and Skild AI.

A buyer that cannot take over the China business gets a smaller prize. It also gets an unusual question: can a company own most of a robot maker, but not its biggest regional operation?

Nobody has the answer yet. ABB and SoftBank say the talks go on.

The companies have not said whether they will:

• Change the deal: reshape it so the China part is handled differently.
• Appeal or negotiate: work with Chinese authorities on conditions.
• Walk away: end the agreement, which would leave ABB without a buyer.

ABB's robot unit stays inside ABB until the deal closes. Its factories keep building robots, and its customers keep ordering them.

• If you buy ABB robots: nothing changes today. The deal has not closed, and ABB still runs the business.
• If you follow robots: expect more government reviews of deals that touch robot data and factories.
• If you own ABB or SoftBank shares: the timeline for the sale is now unclear, so watch for updates from the companies.
• If you work in manufacturing: where robots are built and who owns them is becoming a political question, not only a business one.