Economics Minister Guy Parmelin, centre left, and Federal Innovation Minister Francois-Philippe Champagne are shown a robotics demonstration at the ABB plant in Montreal in April 2023.
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China has told SoftBank it will not allow the $5.4 billion (CHF4.4 billion) acquisition of ABB’s robotics division to go ahead in a shock move that threatens to throw Masayoshi Son’s ambitions in physical AI into disarray.
SoftBank was recently informed that the deal would be blocked by China’s National Development and Reform Commission, the powerful state planner tasked with safeguarding supply chain security and stability, according to multiple people familiar with the matter.
China is the biggest market for ABB’s robotics unit, with more than 90 per cent of its robots for Chinese customers manufactured locally. The Swiss-Swedish company employs about 12,700 people in China.
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Until last week, people close to SoftBank and those briefed on the NDRC’s process in China had expected the deal to be approved despite it being subject to a foreign investment security review.
ABB confirmed in a statement on Thursday it has been informed by SoftBank that Chinese regulators had “prohibited the acquisition of the ABB Robotics business in China”.
SoftBank is now trying to determine what went wrong and whether it could try to seek approval again. The ABB division’s operations in China were a significant attraction for the deal, say people close to the Japanese group.
The NDRC review had included detailed scrutiny of ABB’s Chinese supply chains and a demand to retain some of the robotics unit’s manufacturing capabilities in China, according to people familiar with the matter.
SoftBank agreed last October to buy ABB’s robotics division as part of the Japanese group’s push into a sector it believes will be tied to the rise of AI.
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The deal cleared China’s competition review in February. It then became subject to a foreign investment security review that highlighted Beijing’s concern over the transfer of assets developed in China to a Japanese company at a time of heightened tensions with Tokyo and strategic competition with Washington.
The NDRC had been 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, said people familiar with the matter.
ABB set up a joint venture with a Chinese partner in 1992 and its China operations, particularly its robotics business, have long benefited from government support. Shanghai’s government also helped ABB build its $150 million robotics mega-factory in Pudong, which began operating in 2022.
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According to people briefed on their thinking, regulators had also examined keeping intellectual property relating to some of ABB’s robotics business in China, potentially requiring parts of the business to be spun off to Chinese owners for the deal to proceed.
However, those close to SoftBank say there was uncertainty in Japan about which conditions were being formally requested in the days leading up the decision to block the deal.
For SoftBank, ABB’s robotics business has been a key part of founder Son’s bet on physical AI and was intended to form the basis of his plans in the sector along with AI and robotics company Roze in the US.
Son is also in talks to buy Allied Universal, the world’s largest private security group and owner of the UK’s G4S, with a view to using robotics and AI to increase productivity.
SoftBank shares have fallen 38 per cent in the past month and by 28 per cent over the past year amid concerns about AI demand and, in particular, OpenAI’s decision to push its IPO into next year.
That delay has also put pressure on SoftBank’s looming listing of its US data centre developer SB Energy, which is targeting a $50 billion valuation.
The NDRC did not immediately reply to a request for comment.
Copyright The Financial Times Limited 2026
