Symbotic Inc. has entered into a Master Automation Agreement with Walmart Inc. on January 27, 2025, in connection with the completion of a series of transactions under a Purchase Agreement. The agreement outlines the terms for the development, manufacture, and installation of accelerated pickup and delivery systems (APDs) by Symbotic LLC for Walmart. Walmart has committed to purchasing 400 APDs, with an option to buy an additional 200 APDs within 30 days of accepting the 220th unit.
Symbotic will receive $520 million in research and development fees for the APDs, with payments scheduled over a three-year period. Walmart will also have the right to recommend an independent director to Symbotic's board, as long as it owns more than 5% of Symbotic's equity. Walmart is also granted an observer role at board meetings.
The contract is set to last for 12 years, with terms allowing for termination under specific circumstances such as insolvency or failure to meet performance standards. Walmart has also secured favorable terms for Symbotic’s systems and services.
The agreement is part of a broader strategic move that includes Symbotic's acquisition of Walmart Advanced Systems & Robotics Inc., completing the previously announced deal under a Purchase and Sale Agreement dated January 15, 2025. The announcement was made via a press release issued on January 28, 2025.
Symbotic has also issued forward-looking statements regarding the business impact of these transactions, noting potential risks and uncertainties.
Value Investor2025-01-28
