SoftBank Group has added more weapons to its portfolio, this time of the robot variety.
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The Japanese technology giant is pursuing “artificial superintelligence” after agreeing to buy ABB’s robotics business for $5.4 billion. The companies announced the deal late Wednesday, October 8, but the transaction still requires regulatory approval.
Under the agreement, ABB will spin off its robotics division into a new holding company before transferring ownership to SoftBank. The sale marks a retreat from ABB’s previous plan to spin off the division as an independent listed company, which had been in the works since April.
“SoftBank’s next frontier is physical AI. Together with ABB Robotics, we will bring together world-class technology and talent around a shared vision of fusing artificial intelligence and robotics to drive groundbreaking advances that move humanity forward,” exclaimed SoftBank Group CEO Masayoshi Son.
ABB Chairman Peter Boeser offered a more cautious opinion, saying the proposal had been “carefully evaluated by the board and executive committee and compared to the original intention of the spin-off” and that the sale “reflects the long-term strength of the division” while providing “immediate value for ABB shareholders”.
With around 7,000 employees and sales worth $2.3 billion last year (about 7% of ABB Group revenue), ABB Robotics has long been one of ABB’s most high-profile technology businesses, supplying arm-shaped industrial robots for assembly, painting and packaging. However, there was little overlap with other divisions of the Swiss company, which mainly focuses on electrical infrastructure and automated process systems.
ABB CEO Morten Vierod pitched the spin-off earlier this year as a way to “support value creation both within ABB Group and our separately listed pure-play robotics business.” SoftBank’s proposal seems to have accelerated that idea.
For Son, the acquisition fits neatly into his grand plan to dominate what he calls “physical AI,” the blend of artificially intelligent software and machines that can interact with the real world. ABB’s factory floor know-how joins a growing list of robotics companies including AutoStore, Agile Robots and Berkshire Grey.
Following the announcement, SoftBank shares rose as much as 13%, and ABB shares also rose slightly on the Zurich market. If approved, the deal would hand Son another piece of the hardware-heavy puzzle in his decades-long quest to transform SoftBank into the beating heart of a Machine Age empire. ®
