Hyundai Motor Group completes acquisition of Boston Dynamics

Background

Boston Dynamics is a mobile robot company. Before the transaction it was controlled by SoftBank, which sold the controlling interest. By the time the deal closed, hundreds of its Spot robots were operating in power utilities, construction, manufacturing, oil and gas, and mining.^[1]

The agreement

The main terms were announced on 11 December 2020, when Hyundai Motor Group set out plans to acquire a controlling interest in Boston Dynamics from SoftBank.^[2] The buyer was not a single company but a group of Hyundai entities and its chairman: Hyundai Motor Co., Hyundai Mobis Co., Hyundai Glovis Co. and Hyundai Motor Group Chairman Euisun Chung all took part in the acquisition.^[2]

The target was a well-known name in robotics but not a profitable one. Reuters reported in December 2020 that Boston Dynamics had posted a net loss of US$103 million for the fiscal year ending March 2020.^[3] That figure is the background against which the purchase price should be read: the buyer was paying for a company with a strong public profile and a commercial product line, but one that was still losing money.

Completion

On 21 June 2021 Hyundai Motor Group, Boston Dynamics and SoftBank jointly announced that the acquisition of a controlling interest had been completed.^[1] The deal valued the mobile robot firm at US$1.1 billion.^[1] After closing, Hyundai Motor Group held 80 percent of the company, while SoftBank, through an affiliate, kept 20 percent.^[1] SoftBank therefore did not exit entirely; it moved from control to a minority position.

The closing followed receipt of regulatory approvals and the satisfaction of other customary closing conditions.^[1] In other words, the eight-month gap between the December announcement and the June completion was largely a matter of clearing the permissions a transaction of this kind requires before it can take effect.

What the buyer said it would do

Hyundai said it would support the continued expansion of Boston Dynamics' product line and its global sales and service footprint.^[1] That statement points at the two things a small robot company with an engineering reputation tends to need from a large owner: money and manufacturing capacity to broaden what it builds, and a distribution and support network to sell and maintain those machines in more countries.

Why it matters

The transaction is a clear example of a carmaker taking majority control of a robotics company. Cars and mobile robots share a good deal of underlying technology — sensors, electric actuators, batteries, control software — so a manufacturer that already builds vehicles at scale has reason to be interested in machines that move autonomously. The deal also shows how the ownership of robotics firms shifted in this period: a company that had been held by a technology investor moved into the hands of an industrial group, while the earlier owner stayed on as a minority shareholder.

The customer list Boston Dynamics cited at the time is also instructive. Spot was being used not in laboratories or demonstrations but in power utilities, construction, manufacturing, oil and gas, and mining^[1] — sectors where inspecting dangerous or hard-to-reach places is routine work. That is the commercial case for legged robots: going where wheels and people find it awkward to go.