ABB has signed an agreement to disinvest its Robotics division in favor of SoftBank Group for a company value of $5.375 billion, abandoning its previous plan for a spin-off and initial public offering of this business. The deal —subject to regulatory approvals and customary closing conditions— is expected to close by mid or late 2026. With this move, ABB aims to create immediate value for shareholders, simplify its scope, and focus its strategy on electrification and automation, while SoftBank integrates an industrial leader into its bet on “Physical AI”, the convergence of advanced artificial intelligence and robotics.
“SoftBank’s offer has been evaluated against the alternative of spin-off and reflects the long-term strengths of the division. The divestment will create immediate value for shareholders,” said Peter Voser, ABB’s chairman.
For Morten Wierod, ABB’s CEO, “SoftBank will be an excellent home for the business and its staff. We share a vision of a new era of AI-based robotics, where ABB’s technology and SoftBank’s AI and next-generation computing capabilities can combine to strengthen technological leadership.”
Masayoshi Son, President and CEO of SoftBank Group, framed the acquisition within his next strategic frontier: “Physical AI. Together with ABB Robotics, we will unite world-class technology and talent to fuse ‘superintelligence’ and robotics and trigger an evolution capable of propelling humanity forward.”
What’s Being Sold and for How Much
- Asset: ABB Robotics, the Swiss group’s historic division, with approximately 7,000 employees and a prominent position in industrial robotics.
- Figures: 2024 revenue of $2.3 billion (~7% of the group’s sales) and a 12.1% operating EBITA margin.
- Price: Enterprise value of $5.375 billion. ABB anticipates pre-tax book profit of approximately $2.4 billion at closing and net cash inflows of around $5.3 billion (after costs).
- Separation costs: ~$200 million, half already included in the 2025 guidance.
- Carve-out tax costs: ~$400–500 million in cash outflows, according to current estimates.
ABB indicates that funds will be allocated according to its capital allocation principles (financial discipline, organic investment, selective M&A, shareholder returns), without changing its strategic ambitions in electrification and automation.
Organizational Changes at ABB: Three Areas and Discontinued Operations
As a result of the deal, ABB reorganizes its reporting:
- Starting from the Q4 2025, Robotics will be reported as discontinued operations.
- The Machine Automation division — which, along with Robotics, formed the Robotics & Discrete Automation area — will be integrated into the Process Automation area.
- The group will operate with three business areas after reorganization.
ABB emphasizes that, despite the prestige of its robotics division, synergies with other parts of the conglomerate were limited —demand and market dynamics differ —facilitating a corporate exit and a “better fit” under SoftBank’s umbrella.
Industrial Thesis: AI + Robotics, from Laboratory to Factory
For SoftBank, the acquisition is not just a financial bet: it aligns with its “Physical AI” narrative — bringing advanced AI models and next-generation computing to robots that sense, reason, and act in the physical world. ABB provides:
- Proven technology in manipulation, welding, assembly, palletizing, and other industrial applications.
- Integration experience in key sectors (automotive, electronics, food, logistics, consumer goods).
- Global installed base and relationships with industrial customers prioritizing reliability, safety, service, and TCO.
The combination aims to accelerate the transition of AI agents from simulated or office environments to production lines and warehouses, with faster learning loops, better perception, increased autonomy, and orchestration at scale. SoftBank openly aspires to a new generation of “AI-powered” robots that compete in productivity, flexibility, and cost per hour compared to traditional solutions.
Implications for Clients and Employees
- Operational continuity: the announcement does not predict disruptions in the supply chain or after-sales service; the staff (~7,000 people) and the installed base of ABB Robotics are vital parts of the value transferred.
- Product and roadmap: under SoftBank, an increased emphasis on software, advanced sensing, multimodal models, and cloud/edge connectivity is expected, maintaining the mechanical robustness and functional safety demanded by the industry.
- Governance and compliance: integrating AI into industrial processes will need to respect regulations regarding safety, quality, privacy, and cybersecurity; SoftBank frames this operation within its commitment to responsible AI in critical environments.
Roadmap and Accounting: Key Milestones to Watch
- 2025 (Q4):
- Reclassification of the division as discontinued operations.
- Machine Automation is incorporated into Process Automation.
- 2026 (mid–late):
- Closing of the transaction (pending regulatory approval in multiple jurisdictions).
- Recognition of the book profit (~$2.4 billion) and net cash inflow (~$5.3 billion).
- Execution of separation costs (~$200 million) and estimated tax outflows (~$400–500 million).
- Post-close:
- ABB will continue to prioritize electrification and automation (“Engineered to Outrun”).
- SoftBank will integrate ABB Robotics into its AI, robotics, and next-gen computing framework.
Financial Highlights (Summary)
| Concept | Details |
|---|---|
| Enterprise value | $5.375 billion |
| Estimated net proceeds | ~$5.3 billion (after transaction costs) |
| Pre-tax book profit | ~$2.4 billion |
| Separation costs | ~$200 million (about 50% already in 2025 guidance) |
| Carve-out taxes | ~$400–500 million in cash outflows |
| Expected closing | Mid to late 2026 (subject to regulators) |
| Robotics as a share of ABB (2024) | Revenue of $2.3 billion (~7% of group); EBITA margin of 12.1% |
| Employment | ~7,000 people |
(Figures in European format: decimal comma; abbreviations: billion $ = billion US dollars).
Strategic Interpretation: Why It Makes Sense for Both Sides
- For ABB:
- Highlights a valued asset, maximizing immediate value.
- Simplifies its structure and concentrates resources on electrification and automation, where it remains a leader.
- Avoids complexities and risks associated with a spin-off in volatile markets.
- For SoftBank:
- Accelerates its Physical AI vision with a mature industrial platform.
- Gains access to customers and industrial verticals with high entry barriers.
- Combines AI, edge, and robotics into a unique story to capture the next wave of automation.
Risks and Dependencies
- Regulatory: multiple jurisdictions might condition timelines.
- Technological integration: the challenge of combining advanced AI with secure and deterministic OT environments.
- Industrial cycle: robot investment is tied to sector capital expenditures and supply chains; a slowdown could modulate ramp-up.
- Execution: ensuring cost control, efficiencies, and meeting roadmap milestones without disrupting service to customers.
ABB cautions that these are forward-looking statements subject to changes and risks beyond its control.
What to Watch Going Forward
- Regulatory approvals and any imposed conditions.
- Product strategy under SoftBank (software, AI, services) and continuity of current lines.
- Margins evolution and robotics capex in a context of agentic AI and emerging humanoid robots.
- ABB’s capital allocation after cash inflows (deleveraging, M&A, buybacks, dividends), always within its financial discipline framework.
Frequently Asked Questions
Why is ABB selling instead of listing the division?
The SoftBank offer — evaluated against the spin-off plan — reflects the value of ABB Robotics and, according to its advisors, creates immediate value and reduces complexity. The group will continue to focus on electrification and automation.
What happens for ABB Robotics’ customers before the closing?
The transaction is subject to regulatory approval and is expected to close in 2026. Until then, continuity: products, services, and support remain unchanged. After closing, SoftBank will integrate the division with a focus on AI + robotics, maintaining safety and reliability standards.
How does this affect ABB’s financials?
ABB expects a pre-tax accounting profit of approximately $2.4 billion at close and $5.3 billion of net cash, with separation costs around $200 million and taxes of roughly $400–500 million related to the carve-out. From Q4 2025, Robotics will be reported as discontinued operation.
What is SoftBank’s goal with “Physical AI”?
To integrate advanced AI and next-generation computing into robots that perceive and act in real environments. With ABB Robotics, SoftBank aims to bring this vision to factories, warehouses, and logistics lines, leveraging a global installed base and industrial technology proven to work.
via: new.abb