LG Electronics announced a strategic investment move to expedite the advancement of its capabilities in service robotics, a key new business area. LG executed a stock purchase agreement to invest $60 million in Bear Robotics, a startup specializing in AI-driven autonomous service robots.
This strategic investment aims to support LG’s portfolio for long-term growth instead of finding short-term returns. Upon closing the stock purchase, the company will hold the largest portion of Bear Robotics shares on a single-shareholder basis.
Launched in 2017 under the leadership of CEO John Ha, a former Senior Software Engineer and Technical Lead at Google, Bear Robotics gained recognition for its AI-powered indoor delivery robots that cater to markets in the US, South Korea, and Japan.
Bear Robotics is drawing attention for its skills in platforming service robotics software, robot fleet management technology, and cloud-based control solutions. LG is preparing for a transition towards Software-defined Robotics (SDR), a shift from hardware to software emphasis—similar to what has been happening in the mobility industry.
LG has years of experience in robotics and accumulated expertise in deploying robot solutions across various commercial spaces like airports, hotels, restaurants, hospitals, retail stores, museums, smart warehouses, and golf courses. LG runs a facility dedicated to the production of service robots at the LG Future Park in Gumi and boasts world-class capabilities in the management of quality, supply chain, and customer services.
By integrating Bear Robotics’ R&D talent and software platform expertise with its own strengths, LG plans to spearhead efforts in standardizing robot platforms to reduce market-entry costs, thus enhancing operational efficiency and fostering synergies.
LG has been advancing its robot business as one of its future core pillars. Notably from the deployment of guide robots at Incheon International Airport in 2017, the company has progressively introduced tailored solutions for diverse commercial settings, encompassing delivery and disinfection functionalities. Since the preceding year, LG actively pursued expansion into international markets including the United States, Japan and Southeast Asia.
Last year, LG revealed Future Vision 2030, which outlines the goal of evolving into a Smart Life Solution Company that can connect and expand customer experiences seamlessly across various domains, including home, commercial, mobility and virtual spaces. LG also aims to achieve the ‘Triple Seven’ goal: an average growth rate and operating profit of 7% or more, along with an enterprise value translating into an EBITDA ratio of seven.
KEY QUOTES:
“In the service robotics market, we’re focusing primarily on areas such as delivery and logistics. However, we are carefully considering future directions, keeping open the possibility of equity investments or mergers and acquisitions.”
– LG’s CEO William Cho at CES 2024
“Just as Android revolutionized the smartphone era, standardized open platforms are essential for the activation of the robot market.”
– Bear Robotics CEO John Ha.
“As the service robot market enters a period of growth, this equity investment will significantly contribute to securing a ‘Winning Competitive-edge’ for the company. From a mid- to long-term perspective, we will seek to develop our robot business into a new growth engine, exploring various opportunities through the integration of cutting-edge technologies such as Embodied AI and robotic manipulation.”
– Lee Sam-soo, chief strategy officer at LG Electronics
