In a significant move toward restructuring supply chain technology, robotics company Symbotic announced the acquisition of Walmart Advanced Systems and Robotics business. The transaction, valued at $200 million in cash at the time of closing, is poised to strengthen Symbotic’s longstanding collaboration with the retail giant, with an overarching aim of establishing an integrated supply chain.
The acquisition deal also includes up to $350 million of additional contingent consideration, contingent upon the number of Accelerated Pickup and Delivery (APD) systems ordered in the future. Concurrently, Walmart has committed to compensate Symbotic with a total of $520 million, inclusive of $230 million to be paid upon closing, dedicated to the development of an advanced system catering to the evolving demands of modern-day commerce.
This strategic acquisition and the new contractual agreements are expected to bolster Symbotic’s project backlog significantly, potentially adding more than $5 billion to the company’s future commitments. Symbotic envisions this new micro-fulfillment system as a potential game-changer, expanding their market reach by more than $300 billion within the United States alone.
Greg Cathey, Walmart’s Senior Vice President of Transformation and Innovation, expressed enthusiasm over the enhanced partnership with Symbotic. Cathey emphasizes the mutual benefits seen through nearly a decade of collaboration in transforming supply chain technologies, forecasting improvements in customer service and accelerated online pickup and delivery capabilities.
Symbotic, headquartered in Wilmington, Massachusetts, plans to harness Walmart’s financial backing to refine existing fulfillment technologies and introduce new system solutions targeting customer convenience. If performance criteria are met under this robust agreement, Walmart is slated to purchase and deploy APDs across 400 locations over several years, with a potential for further expansion.
Rick Cohen, Chairman and CEO of Symbotic, termed the acquisition as a highly strategic maneuver expanding upon their extensive partnership with Walmart, moving beyond traditional warehousing and venturing into e-commerce settings and last-mile delivery.
Historically, Walmart has engaged various automation providers, such as Bossa Nova, GreyOrange, and Gatik, highlighting an enduring commitment to logistical innovation. Notably, Walmart's acquisition of Alert Innovation in 2022 indicated its dedication to enhancing advanced systems and robotics, now transitioning into Symbotic’s stewardship.
With over 4,600 stores across the U.S., Walmart's reach ensures a broad consumer base, with store-fulfilled deliveries experiencing a formidable increase of nearly 50% year-over-year as of the end of October 2024.
Founded in 2007, Symbotic has consistently set a high standard in developing robotic solutions spanning retail, wholesale, and the food and beverage industries. It utilizes advanced machine learning and high-density storage solutions to tackle intricate distribution challenges, augmenting Walmart's supply chain operations since 2017 across all its regional distribution centers.
Aligned with Symbotic’s expansion trajectory, the company previously acquired Veo Robotics and OhmniLabs, and welcomed robotics veteran James Kuffner as its Chief Technology Officer. These strategic moves position Symbotic at the forefront of technological advancements in logistics and fulfillment.
The parties involved anticipate that the acquisition will reach completion in Symbotic's second fiscal quarter of 2025, with Citi fulfilling the role of financial advisor in the transaction. As the industry witnesses these firms deepen ties, all eyes are set on how this expanded relationship will resculpt the landscape of retail logistics and customer delivery services in the years ahead.
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