China said to reject SoftBank's $5.4 billion ABB robotics deal

The decision creates additional regulatory uncertainty for SoftBank at a time when its shares were already being hit by Arm's slide and the AI selloff, and the question of whether a fresh application stands a chance could keep that pressure in place. ABB still carries the robotics division on its balance sheet, and investors may now watch for whether the company resurrects plans to spin it off. Because China is the unit's biggest market, Beijing wields considerable leverage here, underscoring how late-stage regulatory reviews in China can imperil cross-border technology transactions. Sentiment around robotics and automation stocks could be affected as the physical AI investment narrative runs into a geopolitical obstacle.

Son envisioned ABB's robots as a cornerstone of SoftBank's physical AI future, yet the unit's biggest market has now said no.

Summary:

• The FT reports Chinese regulators have told SoftBank the $5.4 billion takeover of ABB's robotics unit will not be permitted.
• According to the FT, China's National Development and Reform Commission delivered the news to SoftBank.
• SoftBank is looking into why the deal was blocked and whether a fresh application is possible.
• ABB's robotics division counts China as its largest market.
• The transaction had already secured unconditional clearance from the European Union in March.
• SoftBank's stock dropped roughly 5%, pressured as well by Arm's decline and the AI selloff.

The Financial Times reported on Thursday, citing several people with knowledge of the situation, that Chinese regulators have informed SoftBank Group that its $5.4 billion purchase of ABB's robotics division will not be approved, a blow to Chief Executive Masayoshi Son's drive toward what he terms physical AI.

The FT's account, carried by Investing.com, said the National Development and Reform Commission — China's leading economic planning body — relayed the decision to SoftBank. The company is now working to understand what happened and whether it might reapply for consent, according to the FT. Reasons behind the rejection were not made public.

Beijing's stance is especially significant here, as ABB's robotics unit derives its largest market from China.

The agreement to acquire the entire robotics operation of the Swiss engineering firm ABB, for around $5.375 billion, was struck by SoftBank in October 2025, with closing targeted for mid-to-late 2026. The European Commission granted unconditional approval in March, although clearances from both China and the United States were still outstanding as of late October.

The division brought in about $2.3 billion of revenue during 2024, representing roughly 7% of ABB's group-wide total, and staffs about 7,000 people. Robotics had been placed by Son at the core of SoftBank's AI plans; he has framed physical AI — artificial intelligence paired with machines operating in the physical world — as the company's next frontier.

SoftBank shares were down roughly 5% in Tokyo morning dealings — the market was paused for its midday break when this news arrived — trailing a 0.5% fall in the Nikkei 225. Arm Holdings, SoftBank's valuable chip unit, slid overnight after delivering a weaker-than-expected outlook for the current quarter, adding to the pressure on the stock, as did a wider retreat from AI-related equities following the Democrats' capture of both houses of Congress in the US midterm elections. SoftBank's sizable stake in OpenAI leaves it heavily exposed to the buildout of US data centres, an area Democrats have indicated they intend to subject to closer scrutiny.

What comes next depends on how SoftBank and ABB respond and whether a revised submission or concessions can save the transaction. Should that fail, ABB must determine how to deal with the robotics business by itself.