China Reportedly Blocks SoftBank's $5.4 Billion Deal for ABB Robotics Over Data Concerns

A major robotics purchase faces a Chinese veto

China has reportedly told SoftBank Group it will not approve the Japanese investor's $5.375 billion purchase of ABB's robotics business, threatening a deal that would bring about 7,000 employees and roughly 500,000 installed robots into Masayoshi Son's artificial intelligence strategy. China accounts for around 30% of the division's business, making its decision central to the transaction.

ABB said SoftBank had informed it that China's Office of the Working Mechanism for Foreign Investment Security Review had prohibited the acquisition of ABB's robotics business in China. The office is part of the National Development and Reform Commission, China's top economic planning agency. Reporting citing people familiar with the matter identified concerns about robotics data moving overseas, where it could help train AI models including those developed by OpenAI, as a reason for the objection. SoftBank is a major investor in OpenAI.

The reported decision emerged on November 5. ABB's statement did not specify the reasons for the decision or mention concerns related to data transfers or AI training. No published ruling or statement from the Chinese regulator explaining the decision was available in the supplied reporting. Asked about the matter on November 5, Chinese foreign ministry spokesperson Guo Jiakun referred questions to the relevant Chinese authorities. ABB said the companies remained in close dialogue and continued to work on the transaction. Whether a revised application could secure approval, and when any further decision might come, remained unknown.

For Son, SoftBank's chief executive, the acquisition was a large step toward physical AI: artificial intelligence connected to machines that can move, handle objects and perform work in the real world. For ABB, the Swiss engineering group, the sale was a planned departure from a business that generated about $2.3 billion in revenue in 2024.

What SoftBank agreed to buy

SoftBank signed the agreement on October 8, 2025, to acquire 100% of ABB's robotics business. The transaction assigned it an enterprise value of $5.375 billion, commonly rounded to $5.4 billion. Enterprise value measures the value of a business while taking account of its debt and cash.

ABB's division brings an established industrial operation, including customers such as BMW, a global installed base of approximately 500,000 robots and thousands of employees. Those existing machines give the business a presence in factories already carrying out production work.

The robotics unit contributed roughly 7% of ABB's group revenue in 2024. Selling it would therefore remove a relatively small share of ABB's sales while transferring an entire business with its own customers, workforce, technology and manufacturing operations.

SoftBank had planned to complete the purchase in the middle or latter part of 2026, subject to regulatory approvals. That condition matters because signing an acquisition agreement and completing the ownership transfer are separate steps. Regulators can prevent completion even after the buyer and seller have settled the commercial terms.

How the approval process unfolded

The European Commission cleared the transaction without conditions in March. That gave the companies approval in one major jurisdiction, while reviews elsewhere continued. US approval was still outstanding in the latest account of the transaction.

SoftBank reportedly expected Chinese approval until the week before the November 5 report. The change would leave the company reassessing a transaction it had spent more than a year preparing to complete.

• October 8, 2025: SoftBank signed the agreement to buy ABB's robotics business at an enterprise value of $5.375 billion.
• March 2026: The European Commission cleared the acquisition without conditions.
• Middle to late 2026: The companies' original target period for completion.
• Late October: Chinese and US approvals were still pending.
• November 5: The reported Chinese rejection became public, with SoftBank assessing whether it could seek approval again.

Approval in Europe cannot settle China's review. Each jurisdiction considers the transaction under its own rules and priorities. For an industrial business operating across several major markets, completion depends on securing the permissions required for the agreed deal.

Why China matters so much to ABB robotics

China is ABB's largest robotics market, accounting for around 30% of the division's business. Put simply, about three out of every ten parts of its business are tied to that market. The country is also the world's largest market for industrial robots.

ABB has a manufacturing hub in China and a robotics team there of more than 2,000 people. Its Chinese operations are therefore part of the business being acquired, alongside the technology and customer relationships developed elsewhere.

Local competition has also become stronger. Figures cited for China's industrial robotics market put domestic manufacturers' share at 58% in 2024, up from 47% previously. That is an increase of 11 percentage points, moving Chinese suppliers from below half of the market to a majority.

ABB's robotics business was reported to have held more than 70% of the Chinese market at its historical peak, although no date was attached to that figure. The more recent domestic market figures describe the competitive pressure facing foreign suppliers today: Chinese manufacturers now win a larger share of orders in the industry's biggest national market.

Why robot data is part of the dispute

The reported Chinese concern focuses on information generated by robotics operations and whether it could be transferred abroad to train AI systems. OpenAI's place in SoftBank's investment portfolio gives that concern a direct connection to the buyer's wider strategy.

Industrial robots use information to carry out tasks, such as the position of an object, the movement needed to grasp it and whether an action succeeded. Depending on the system, cameras and other sensors can help a machine adjust to its surroundings. Information from those processes can be useful when developing software that teaches machines to perform physical tasks.

A factory also contains commercially sensitive information about how products are made. Decisions about who controls operational data, where it is stored and who can use it can therefore matter to manufacturers as well as governments.

ABB's large installed base helps explain why data is relevant to this acquisition. SoftBank would be buying an established robotics operation at the same time that it is investing heavily in AI. The reported regulatory objection brings those two parts of its strategy together.

What the setback means for Son's AI strategy

Son has placed robotics at the centre of SoftBank's ambitions for physical AI. Software that answers questions or generates text works mainly through a screen. Physical AI connects software to equipment that must act reliably around real objects, people and production processes.

ABB would give SoftBank scale in that field immediately: an industrial customer base, manufacturing capabilities, an experienced workforce and robots already operating around the world. Building an equivalent operation would require developing those elements over time.

SoftBank already has a stake in Boston Dynamics, so its exposure to robotics extends beyond the ABB agreement. The proposed purchase nevertheless represents a much larger commitment to an established industrial robotics business.

SoftBank's OpenAI investment also links its ambitions to the construction of US data centres that support AI development and use. Its investment strategy now spans several connected activities: computing infrastructure, AI models and machines capable of turning software instructions into physical action. The ABB deal would strengthen the last of those activities.

Why SoftBank shares were already falling

SoftBank shares were down about 5% in Tokyo morning trading, compared with a decline of roughly 0.5% in the Nikkei 225. The stock's fall was about ten times the benchmark's percentage decline, showing that SoftBank faced greater selling pressure than the wider Japanese market.

The shares changed little immediately after news of the reported Chinese rejection. Investors were already responding to an overnight fall in Arm Holdings, the chip designer that is a major holding in SoftBank's portfolio, after its guidance for the current quarter disappointed expectations.

A broader selloff in technology and AI shares added pressure. SoftBank's exposure to Arm, OpenAI and the US data centre buildout means its stock can respond to several developments at once, from chip demand to the outlook for AI investment.

The timing matters for understanding the market reaction. Most of the reported 5% decline was already in place when the acquisition news emerged, placing the robotics setback alongside other concerns affecting the company that morning.

What SoftBank and ABB must decide next

SoftBank is assessing what went wrong and whether it can seek approval again. A renewed application would require the company to understand the regulator's objections and determine whether changes to the transaction or commitments about its operation could address them.

If data transfers are the central concern, negotiations could focus on how information is stored, accessed or used. Such measures are possible subjects for discussion; neither company has announced a proposed remedy or a revised transaction structure.

ABB faces a different decision if the sale cannot proceed. It would retain responsibility for a robotics division it had agreed to sell, including its workforce, customer commitments and manufacturing operations. The company would then need to determine how to manage the business and whether to pursue another route for its ownership.

The immediate consequence is uncertainty for both companies' plans. SoftBank lacks approval for an acquisition intended to expand its robotics operations, while ABB cannot complete its planned exit under the current timetable without the necessary regulatory permissions.

Key Points

• ABB said SoftBank had been informed that China's foreign investment security review office had prohibited the acquisition of ABB's robotics business in China, affecting the $5.375 billion deal.
• Reporting citing people familiar with the matter identified concerns about robotics data moving overseas for use in AI training, including by OpenAI; ABB's statement did not give reasons for the prohibition.
• China accounts for around 30% of ABB's robotics business and hosts a team of more than 2,000 people.
• The division generated about $2.3 billion in revenue in 2024 and employs approximately 7,000 people worldwide.
• Europe approved the deal in March; the US review was still pending.
• SoftBank is considering whether to seek approval again. Neither company has announced a revised plan.