SoftBank buys majority stake in Cubic Telecom for €473m

5 Dec 2023

From left: Barry Napier and Shane Sorohan. Image: Cubic Telecom

Cubic CEO Barry Napier said the investment, Ireland’s biggest-ever software deal, marks a ‘significant milestone’ for the company as it reaches a valuation of €900m.

Japan’s SoftBank Corp has acquired a majority stake in Dublin-based Cubic Telecom, which makes internet-of-things (IoT) software for vehicles, for €473m.

Reportedly Ireland’s biggest software deal ever, the acquisition will see SoftBank gain a 51pc equity stake in Cubic at a valuation of more than €900m. The idea is to capitalise on the growing connected vehicles and original equipment manufacturers (OEM) market globally.

Cubic CEO and board member Barry Napier will retain his positions after the deal closes while three executives from SoftBank will join the Irish company’s board as it becomes a consolidated subsidiary of the Japanese company.

Napier said that the investment marks a “significant milestone” for Cubic as it teams up with SoftBank to “pioneer the future of software-defined connectivity”.

“The focus on software rather than hardware means manufacturers can increase the value of a vehicle or device by adding new functionality, over-the-air, which will improve safety, comfort and performance,” he said.

“This, alongside the opportunity AI presents, will open up new collaborations and business models. The opportunities ahead of us are endless.”

Working with some of the world’s leading vehicle manufacturers, Cubic connects more than 17m cars and vehicles globally and has agreements with more than 90 multinationals on connectivity.

Junichi Miyakawa, president and CEO of Tokyo-headquartered SoftBank, said that the acquisition deal will help the two parties make a “full-fledged entry” into the fast-growing IoT asset connectivity market.

“With its global leadership position, we are convinced Cubic Telecom is the best partner for this opportunity, and we look forward to building connectivity platforms for next-generation social infrastructure.”

Fergal McAleavey, corporate finance partner at EY Ireland and one of the advisers in the acquisition, said that the investment represents the largest ever software deal in Ireland.

“Cubic Telecom is a world leader in the field of software-defined connected vehicle solutions and this investment will power further global growth over the coming years. Barry Napier and his team are true trailblazers and innovators,” he said.

“This investment is also a really welcome boost for Irish M&A [mergers and acquisitions] activity, particularly for our thriving indigenous software and technology sectors, and bodes well for a more active 2024 in terms of M&A, investments and access to capital.”

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Updated, 10.55am, 5 December 2023: This article was updated to reflect that SoftBank Corp made the investment in Cubic Telecom, not SoftBank Group as originally reported here. SoftBank Corp is a subsidiary of SoftBank Group with a separate listing on the Tokyo Stock Exchange. 

Vish Gain is a journalist with Silicon Republic