SoftBank Corp. (TOKYO: 9434), a telecommunications and IT operator headquartered in Tokyo, Japan, made an investment of approximately €473m in Cubic Telecom Ltd., a Dublin, Ireland-based provider of software-defined connected vehicle solutions.
SoftBank received a 51.0% equity stake in the company, at a valuation of over €900m. The investment is subject to regulatory approvals in various jurisdictions, and other customary closing conditions, and is expected to close in the first half of 2024.
With this investment, SoftBank and Cubic Telecom will form a strategic global partnership to pioneer the future of software-defined connected vehicles and other high-value Internet-of-Things (IoT) assets by harnessing the power of global connectivity platforms.
Cubic Telecom is a global provider of connectivity solutions to automotive, transportation and agriculture original equipment manufacturers (OEMs). Its Platform for Application & Connectivity Enablement (PACE) allows OEMs to monitor, manage and update many aspects of a vehicle or device in real-time, globally, via mobile connectivity – meaning vehicles can be tailored to the requirements of a country or region while complying with different regulatory mandates. Vehicles and devices can receive new features and functionality over-the-air (OTA) throughout their lifetime, which improves performance, safety, comfort and value to ensure the best user experience. Cubic Telecom has grown rapidly since launching its connectivity platform in 2016, and through agreements with more than 90 mobile network operators (MNOs), the company currently connects more than 17 million vehicles in over 190 countries and regions, adding 450,000 new vehicles a month, which is expected to increase exponentially over the next 5 years.
By collaborating with SoftBank, which has an extensive customer base in Japan and other Asia-Pacific countries and regions, Cubic Telecom will gain access to new sales channels to further build on its market leadership position. SoftBank and Cubic Telecom will also explore ways to generate synergies and develop new services, such as utilizing satellite and stratospheric-based Non-Terrestrial Network (NTN)-based solutions that provide connectivity to vehicles and IoT devices in areas that cannot be reached by traditional ground-based networks.
After the investment closes, Barry Napier will continue to lead Cubic Telecom as CEO and Board Member, and Daichi Nozaki, SoftBank’s Senior Vice President responsible for its global business, and two other SoftBank appointees will join Cubic Telecom’s Board. Three Board seats will continue to be held by Cubic Telecom’s existing shareholders, including CARIAD (Volkswagen Group) and Qualcomm, and with the close of the investment, Cubic Telecom will become a consolidated subsidiary of SoftBank.
While SoftBank has been providing global IoT connectivity services, mainly in Asia-Pacific markets, in this new strategic partnership with industry leader Cubic Telecom, SoftBank will be able to make a full-fledged entry into the rapidly growing IoT markets for connected cars and software-defined vehicles, giving it access to new revenue generating opportunities.
FinSMEs
07/12/2023