iRobot Corp. (NASDAQ: IRBT), well known for its Roomba automated home vacuum cleaners, announced that it has signed a definitive agreement to sell its Defense and Security business to Arlington Capital Partners (ACP) for up to $45 million in total consideration, including a contingent payment based on achieving certain milestones. This transaction enables iRobot to solidify its position as the leader in diversified Home Robots and focus on technologies for the connected home.
“In the spring of 2014, we engaged Blackstone Advisory Partners LP, now known as PJT Partners, to review strategic alternatives for our Defense and Security business,” said Colin Angle, iRobot chairman and CEO. “After a thorough and deliberate process, we’ve concluded the sale of the business to Arlington Capital Partners will maximize shareholder value by allowing us to focus on our much larger Home segment.”
The transaction is expected to close in the next few months. The anticipated financial impact of the divestiture, including one-time costs, will be disclosed in iRobot’s fourth-quarter and full-year earnings press release and investor call on February 10 and 11, 2016.
According to ACP, the business will operate as a newly created independent company (the “Company”). The Company, which will be renamed upon closing, will be the largest independent provider of ground-based robots to the U.S. Department of Defense, with a significant and growing global presence in the security, industrial and international defense markets.
The Company’s leading robotic designs are proven in the most dangerous and hostile environments, providing warfighters and first-responders with invaluable situational awareness while improving mission effectiveness and saving lives. Its four-classes of robots, the FirstLook, SUGV, PackBot and Kobra, provide a wide spectrum of capabilities for countless situations. Since inception, more than 6,000 of these robots have been delivered to customers worldwide. Sean Bielat will be named CEO and Tom Frost, currently SVP & GM of iRobot’s Defense & Security business, will be named President. He will lead the same team that has built the iRobot Defense and Security suite of robots. The organization will continue to be based in Bedford, Mass.
“I am thrilled to be rejoining such an amazing organization,” said Sean Bielat, incoming CEO of the Company. “As an independent company, we will be focused on our own goals and objectives and pursue the numerous opportunities that lie ahead of us.”
Tom Frost, President, said, “It is an exciting time for the Company. Building on our long history of innovation and technological achievement serving the defense and security markets as a part of iRobot, we are looking forward to continuing our committed, customer focused approach as a new company. We are enthusiastic to have the backing of Arlington Capital, whose expertise in the defense sector and strong capital commitment will accelerate our growth trajectory.”
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