03:26 PM EST, 01/16/2025 (MT Newswires) -- Symbotic ( SYM ) said Thursday that it agreed to acquire Walmart's ( WMT ) advanced systems and robotics business for $200 million in cash at closing as part of a deal that aims to expand the retail giant's automated supply chain.

The warehouse automation firm has helped Walmart ( WMT ) automate its supply chain since 2017. Symbotic ( SYM ) said it is deploying its software and robotics platform across all 42 of Walmart's ( WMT ) regional distribution centers in the US.

The retailer has selected Symbotic ( SYM ) to develop a technology to automate its accelerated pickup and delivery, or APD, centers, previously known as market fulfillment centers. Symbotic ( SYM ) said it will also design new systems to meet the needs of current and future customers.

Walmart ( WMT ) has committed to buying and deploying systems for 400 APDs at stores over a multiyear period, subject to certain performance criteria being achieved. The retailer has an option to add more APDs in the coming years, Symbotic ( SYM ) said. Walmart ( WMT ) will pay Symbotic ( SYM ) $520 million related to the development of an artificial intelligence-enabled robotics platform, including $230 million at closing.

Symbotic's ( SYM ) shares were up nearly 19% in Thursday late-afternoon trade, while Walmart's ( WMT ) were little changed.

"This is a highly strategic transaction for Symbotic ( SYM ) as we expand upon our long-term relationship with Walmart ( WMT ) and broaden our product offering beyond the traditional warehouse to e-commerce settings for last mile delivery," Symbotic ( SYM ) Chief Executive Rick Cohen said.

The company expects up to $350 million in additional consideration in the future, based on the number of APD systems ordered. Symbotic ( SYM ) expects the acquisition to close in its fiscal second quarter. The company said deal and new agreements could raise its future backlog by more than $5 billion.

"We anticipate the synergy between Symbotic's ( SYM ) expertise and our nearly decade-long relationship in innovating the supply chain technologies to elevate customer service and rapidly advance our in-store (APD) capabilities," said Greg Cathey, Walmart's ( WMT ) senior vice president of transformation and innovation.

Separately, Oppenheimer initiated coverage of the Symbotic ( SYM ) stock with an outperform rating and a $35 price target.

"We see the company disrupting the warehouse and distribution center market with AI-driven automation that has the potential to reshape the fulfillment supply chain through lower-cost, higher-accuracy warehouse automation and the potential to deliver warehouse-as-a-service offerings though its GreenBox JV with SoftBank," Oppenheimer analysts, including Colin Rusch, said in a note e-mailed Thursday.

Price: 32.15, Change: +5.38, Percent Change: +20.10