ABB: SoftBank Group Set to Acquire Robotics Business

Key Morningstar Metrics for ABB

• Fair Value Estimate: $54.00
• Morningstar Rating: ★★
• Morningstar Economic Moat Rating: Wide
• Morningstar Uncertainty Rating: Medium

ABB ABBNY announced that it will sell its robotics division to SoftBank for $5.4 billion, shifting from its initial intention in April to spin off and list the division. The robotics business contributed 7% to the group’s sales. The transaction is expected to close in mid- to late 2026.

Why it matters: The divestment makes strategic sense for ABB, given the latter’s few synergies with the group and its inferior profitability compared with the leading robot manufacturer, Fanuc. The sale price is above the market’s initial expectations at the announcement of the decision in April.

The bottom line: We maintain our fair value estimate for wide-moat ABB. We believe ABB is receiving a fair price, resulting in a price/sales multiple of 2.3 times, or 19.0 times its 2024 EBIT. Shares look rich.

• ABB is trading at a P/E multiple of 29 times 2025 estimated earnings, a 15% premium to its three-year average, and the highest of its Europe-listed peers. We view this as lofty, given its lower growth prospects due to less exposure to fast-growing end markets such as data centers.

Between the lines: ABB announced the proceeds will be used in line with its current capital allocation priorities of organic growth, dividends, acquisitions, and buybacks. However, we highlight that acquisitions have become a growing component of the group’s strategy.