SoftBank said to weigh buying security giant Allied

SoftBank Group is considering buying Allied Universal, the largest security services company in the US, as founder Masayoshi Son looks for ways to put AI-powered robots to work across industries, Bloomberg reported on Friday, October 16, citing people familiar with the matter. A deal could give the privately held Allied an equity value of up to $18 billion, according to Bloomberg.bloomberg.com

SoftBank's US-traded shares fell sharply after the report, dropping more than 8% in Friday trading, Seeking Alpha reported. Investors had to weigh another large commitment from a company already spending heavily on artificial intelligence.investing.com

A deal near $30 billion

Allied has about $12 billion in publicly traded debt, so including it could bring the total value of a transaction close to $30 billion, Investing.com reported, citing Bloomberg. Talks are still preliminary, and no final decision has been made on whether to pursue a deal or at what price, the report said.investing.com

Allied is backed by Warburg Pincus, Caisse de dépôt et placement du Québec (CDPQ), Partners Group and The SAFRA Group, according to the company's newsroom. Chairman and CEO Steve Jones has said Allied keeps looking for acquisitions and could consider an initial public offering, the same post said.ausnewsroom.aus.com

Robots on patrol

Son has named security as a promising area for robots. In some cases, such as one-off events like concerts, fleets of robots could replace human guards when the economics work, Investing.com reported, summarizing Bloomberg's reporting.investing.com

Allied supplies security staff to businesses, events and infrastructure, including New York City's subway system under contracts with the Metropolitan Transportation Authority. It also offers intelligence analysis, canine units, bomb technicians, and janitorial and facility maintenance services, according to Investing.com. The company is also a major provider of security at data center construction sites, a business growing as spending on AI infrastructure rises.investing.com

For SoftBank, Allied's large workforce and customer base would be a ready-made place to test robots built by its portfolio companies, instead of finding customers from scratch. Robots may handle routine patrols and surveillance. Emergency response and work that needs human judgment could still be hard to fully automate, Investing.com noted.investing.com