We are living in a volatile era. Terms like "IPO" and "M&A"—once distant concepts for domestic automation brands—have migrated from the tech sector into the heart of industrial manufacturing.
This article offers a personal perspective on ABB’s recent divestment of its Robotics division and the trajectory of B&R since its acquisition in 2017. All references are sourced, and speculative data is calculated using "best-case" estimates for the parties involved. Note: This represents personal opinion and does not constitute investment advice.
1. The Prelude: A Sudden Exit
On October 8th, ABB sold its Robotics division to Japan’s SoftBank for $5.4 billion. While rumors of a spinoff or sale had circulated due to lackluster financial performance, the speed of the transaction was unexpected.
SoftBank claims it will integrate AI with robotics. How "ABB Robotics" will evolve under this new banner remains to be seen. However, one historical milestone is clear: the "Big Four" of robotics are now entirely under Asian ownership. KUKA went to China’s Midea in the mid-2010s, and now ABB has transitioned to SoftBank.
2. Does 1+1 Truly Equal More Than 2?
For a company with massive clout in both Process and Discrete automation, ABB’s decision to drop Robotics is puzzling. While financial metrics govern all listed companies, the strategic importance of robotics to discrete automation is self-evident.
Theoretically, after the 2017 acquisition of B&R, the synergy between B&R’s control systems and ABB’s robots should have yielded a "$1+1 > 2$" effect. On paper, it looked perfect: ABB’s investment in PMI brought ACOPOS 6D (planar motor technology) to B&R, creating a high-tech "Automation + Robotics" ecosystem.
The divestment suggests this synergy failed to materialize. A primary reason is that ABB’s robotics competitiveness has waned. In the automotive sector—once the stronghold of the Big Four—local brands have gained ground, and OEMs are squeezed by fierce competition. Outside of automotive, ABB lacked competitive Cobots and SCARA units for general industry, failing to bridge the gap through strategic acquisitions of agile startups.
By 2024, despite respectable revenue, Robotics had become a "marginal" asset (the proverbial "chicken rib") within the ABB portfolio. The question now: Without Robotics, what value does ABB bring to B&R?
The Four Paths of Acquisition
Typically, an acquisition follows one of four paths:
Absorption: Integrating the product into the parent line (e.g., Eaton absorbing Moeller).
Brand Independence: Maintaining the brand but unifying operations (e.g., Schneider Electric’s long-term strategy before eventual brand unification).
Operational Autonomy: Independent management (e.g., Midea/KUKA or Danaher/Kollmorgen).
Asset Stripping: Buying for IP and selling the shell (e.g., Google buying Motorola for patents before selling to Lenovo).
B&R’s position within ABB started as Path 1 but now feels stuck in the "awkwardness" of Path 3.
Financial Realities
ABB’s 2023 reports didn't break out B&R’s specific revenue. However, by taking the "Robotics & Discrete Automation" total of $3.2 billion and subtracting the $2.4 billion attributed to Robotics in the SoftBank deal, we can estimate B&R’s revenue at roughly $800 million to $1 billion.
At the time of the 2017 acquisition, the mid-term goal was $1 billion. While B&R has met this "on par," it is losing ground to its chief rival, Beckhoff, which reported 2024 revenues of €1.17 billion (~$1.37 billion). B&R has not achieved the "hyper-growth" expected from the acquisition.
3. Fading Orange: The Signs of Change
Since 2017, significant integration in products or channels hasn't fully materialized. However, several subtle shifts are visible to the outside world:
The Logo: B&R’s original artistic logo was highly recognizable. The new iteration has seen the ratio of "B&R Orange" drop off a cliff. It may be "modern," but it dilutes the brand equity.
The End of EPSG: In 2023, B&R announced the closure of the EtherNet POWERLINK Standard Group (EPSG). POWERLINK management was pulled back in-house. This signals the transition of POWERLINK from an open industry standard to a "closed" internal bus. Simultaneously, EtherCAT slave modules have appeared in B&R’s catalog.
The "Economic" Shift: In September, B&R launched a new line of budget-friendly servos and inverters. These products bear a striking resemblance to certain domestic Chinese brands and—crucially—feature none of the signature B&R Orange. Walking through recent events, ABB Red is systematically replacing B&R Orange. The orange ties, once a symbol of the B&R engineer, are disappearing from keynotes, relegated to old profile pictures on PPT slides. It feels like a clean break from the past.
4. Epilogue: The Modular Future
Enterprises, like software, are modular. But integrating two "company modules" is far more complex than linking two function blocks.
B&R was founded in 1979 by Erwin Bernecker and Josef Rainer. They built their empire on industry-specific "Know-How" (Plastics, Packaging) and high-end specialized software. Unlike Hans Beckhoff, who remains a visible face of European automation, B&R’s founders stayed out of the limelight.
When B&R was sold in 2017, the industry consensus was a lack of succession. In European family businesses, if the next generation isn't interested, selling is the only viable exit.
B&R’s growth path—moving from a niche player to a general automation powerhouse—is a blueprint for many ambitious firms today. However, the "general" market is now saturated. B&R succeeded because of its proximity to Southern Germany’s mechanical engineering hubs. Beckhoff, slightly further away, developed a sharper "intuition" for PC-based control and EtherCAT early on.
Ultimately, the dissolution of EPSG and the shift in branding might be seen by ABB as "cutting unnecessary costs." But one must wonder: Could SoftBank, with its IT-centric vision and deep pockets, eventually buy B&R too? Would an IT mindset produce a better automation product?
ABB's recent investments are pivoting heavily toward Energy and AI-driven power infrastructure. In this shifting landscape, do you believe B&R still fits the long-term puzzle?