SoftBank Group is exploring an acquisition of Allied Universal, the largest security services company in the United States, in a potential transaction that could reach a total value of $30 billion, according to reports from Fintech Gate and Al Borsa Newspaper.
SoftBank Considers $30 Billion Purchase of Allied Universal
Under the preliminary discussions, the equity value of Allied Universal could be valued at $18 billion. The company’s debt—distributed among loans and bonds—amounts to approximately $12 billion, bringing the potential total deal value to $30 billion. Sources noted that the negotiations remain in their early stages, and no final decisions have been made regarding the acquisition or pricing.
Following the reports, American depositary receipts for SoftBank declined by up to 9.9% during trading in New York to settle at $14.72. This occurred during a market sell-off and investor concerns regarding the scale of investments the group is channeling into the artificial intelligence sector. SoftBank declined to comment on the acquisition report, and Allied Universal did not immediately respond to requests for comment.
SoftBank Seeks to Automate Security Services
The potential acquisition aligns with the strategic efforts led by SoftBank founder Masayoshi Son to deploy AI-backed robots across various sectors and reduce operating costs by automating tasks currently performed by human workers. Allied Universal currently provides guarding and security services for corporations, institutions, and major events, alongside a growing presence in securing data center projects expanding across the United States.
Allied Universal provides security services for the New York City subway system under contracts with the Metropolitan Transportation Authority. It also provides specialized services including intelligence analysis, canine units, explosives experts, and facility management and cleaning. The security firm is backed by investors including Warburg Pincus and the Canadian pension fund La Caisse, which valued the company at over $7 billion in 2019 when it invested.
Developing humanoid robots capable of handling complex security situations could take additional years of technical and practical development.
SoftBank Invests in AI and Robotics Ventures
SoftBank maintains an extensive portfolio of technology investments. Its previous ventures include a $65 billion investment commitment with OpenAI.
It also includes the establishment of an artificial intelligence and robotics entity named Roze with ambitions for a U.S. public offering, and an agreement last year to acquire Swiss-based ABB’s industrial robotics unit for $5.4 billion. The group previously invested $200 million in holding company Robo HD to consolidate its robotics investments and assets under a single entity.
SoftBank introduced its humanoid robot Pepper in 2014 before halting production in 2020. It acquired Boston Dynamics in 2017 before later selling a majority stake to Hyundai Motor Group. Through its Vision Fund, SoftBank was an early investor in Alibaba, holds a majority stake in semiconductor design firm Arm, and previously supported workspace provider WeWork.
Will SoftBank and Allied Universal reach a definitive agreement on valuation and deal terms, and will the group successfully realize economic returns from automating security services?
