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SoftBank makes offer to acquire Balyo shares

Balyo, a robotics company with nearly 18 years of experience in the industry, could soon find itself under new ownership. SoftBank Group has entered into an agreement to acquire a 41.8% stake in the company for €11.8 million, around $12.9 million. 

According to the agreement between the two companies, SoftBank Group will be buying its shares from Bpifrance Investissement, SSUG, Financiére Arbevel, Linde Material Handling, Hyster-Yale, Invus Public Equities, L.P., and Thomas Duval, as well as from some employees and legal representatives of Balyo. 

The companies hope to finalize the deal during the final quarter of 2023. If the deal is finalized, SoftBank wants to “implement a mandatory squeeze-out on the remaining outstanding shares of Balyo” and delist the company, according to a release from Softbank.

Balyo’s portfolio of automated robotic forklift technologies complements SoftBank’s existing investments in the transportation and logistics industries. When the acquisition is finalized, Balyo will have access to SoftBank’s global network of over 470 technology-led companies, giving it the opportunity to develop new commercial relationships. 

SoftBank is offering to buy the shares at €0.85, a 54.3% increase over the 30-day volume-weighted average stock price, and a 48% increase compared to the weighted average price of the last 60 trading days.

SoftBank is also providing Balyo with interim financing of up to €5 million (around $5.4 million) so Balyo can meet its ongoing working capital requirements. SoftBank will provide the financing in multiple installments via convertible bonds issued by Balyo to SoftBank. The bonds will be due on October 21, 2024.

If the deal were to be terminated, SoftBank would still provide financing, but the amount would be reduced to €3 million. Raine Group and Alantra are acting as financial advisors, and Morrison Foerster and Bredin Prat are acting as legal advisors to SoftBank. 

Balyo’s Board of Directors has welcomed the deal, which is still pending approval from Balyo’s Social and Economic Committee (CSE) and a report from Eight Advisory, a group appointed by the Board of Directors earlier this month as an independent expert. Eight Advisory will issue an opinion on the financial terms of the offer.

Softbank’s growing logistics automation portfolio

In March 2023, Softbank Group reached a deal to acquire Berkshire Grey for about $375 million in cash. In January 2020, Softbank participated in Berkshire Grey’s $263 million Series B financing round. Berkshire Grey develops a variety of robotic technologies that address use cases in retail, eCommerce, grocery, 3PL, and package handling companies.

The deal, which is expected to close in the third quarter of 2023, will make Berkshire Grey a private company – similar to what Softbank wants to do with Baylo. Berkshire Grey went public via a SPAC in mid-2021, but its stock price hasn’t performed well. Berkshire Grey, despite strong sales growth, has a history of profit and cash flow issues.

In April 2021, Softbank bought a 40% stake in ASRS maker AutoStore for $2.8 billion. AutoStore generated $149.2 million in revenue during the first quarter of 2023. That represented 21.1% growth year-over-year. In the fourth quarter of 2022, AutoStore generated $148 million in revenue, up 58% from $93 million in the same quarter in 2021.

“We view AutoStore as a foundational technology that enables rapid and cost-effective logistics for companies around the globe,” Masayoshi Son, chairman & CEO of SoftBank Group said at the time of the deal. “We look forward to working with AutoStore to aggressively expand across end markets and geographies.”

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