Japanese conglomerate Softbank has agreed to purchase robotics units Boston Dynamics and Schaft from Google parent Alphabet.

The purchase of the two divisions will further expand Softbank's robotics portfolio, which already includes the humanoid robot Pepper that was released in Japan in 2015.

SoftBank To Buy Boston Dynamics, Schaft

Alphabet did not disclose the terms of the transactions to purchase Boston Dynamics and Schaft. However, the shares of Softbank increased by as much as 7.9 percent after the announcement of the deal, reaching a 17-year high.

"Smart robotics are going to be a key driver of the next stage of the information revolution, and Marc (Raibert) and his team at Boston Dynamics are the clear technology leaders in advanced dynamic robots," said Masayoshi Son, the chairman of the Softbank Group.

The transactions are part of Softbank's aggressive campaign to acquire companies that will further boost its research and development prowess. The Softbank Group is supporting the Vision Fund, the world's biggest private equity fund worth $93 billion, as it makes investments in technologies that are expected to play a huge role in the near future. Such technologies include robotics and artificial intelligence.

Why The Deals For Boston Dynamics And Schaft Make Sense

Boston Dynamics, a company that specializes in robots with legs, grew in fame due to the videos that it uploads featuring its creations. The latest one featured Handle, a two-legged robot that is 6.5 feet tall with a vertical jump of 4 feet and cruising speed of 9 miles per hour. Boston Dynamics is also known for Atlas, another two-legged robot capable of traversing rough terrain.

Alphabet, however, has been looking to sell Boston Dynamics since early last year, as the executives of the Google parent believed that the division is not capable of creating a marketable product over the next few years. A deal to sell the unit to Toyota was reported in May 2016, but the sale never materialized.

Schaft, meanwhile, is based in Tokyo and previously an entry to the DARPA Robotics Challenge. Google, which later acquired the company, refused to receive funding from the military for the development of its robots. Similar to Boston Dynamics, Schaft specializes in bipedal robots.

Google purchased Boston Dynamics and Schaft a few years ago while planning to create an umbrella robotics unit helmed by Andy Rubin, who was previously the head of Android. However, Rubin left Google in 2014, and the remaining executives did not see the value in the two divisions.

Alphabet has been trying to exit the robotics business, so selling the two divisions to Softbank is a great move for the company. Softbank, on the other hand, has been making further investments into the technology.

The purchases of Boston Dynamics and Schaft would be the second venture into robotics by Softbank's Son, who purchased Aldebaran Robotics in 2012. Two years later, Softbank unveiled Pepper, a humanoid robot with a $1,600 price tag that was envisioned as being capable of performing a variety of tasks such as manning storefronts and providing entertainment.

However, due to clashes between the Japanese executives of Softbank and the French engineers of Aldebaran, Pepper has so far proven to be underwhelming compared to its potential. The purchase of Boston Dynamics and Schaft, meanwhile, could provide a fresh start in robotics to Softbank, with the possibility of a better outcome.

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