iRobot, recognized for its Roomba vacuum cleaner, witnessed a significant 17% drop in shares following a stern warning from the European Union’s antitrust regulator regarding Amazon’s proposed $1.7 billion acquisition. The European Commission, investigating the deal since July, is set to deliver a verdict by February 14, expressing provisional concerns that the acquisition may stifle competition in the robot vacuum cleaner market.
In response, an Amazon spokesperson assured CNBC that the company is actively collaborating with the commission to address the identified issues. iRobot, facing fierce competition in the vacuum cleaner sector, has been known for its practical and inventive products. The potential collaboration with Amazon is viewed as an opportunity to leverage the tech giant’s resources, fueling innovation, investing in crucial features, and potentially reducing prices for consumers.
Amazon’s intention to acquire iRobot was announced in August 2022 at a per-share price of $61. The deal is also under scrutiny by the U.S. Federal Trade Commission. Notably, the UK’s Competition and Markets Authority, in June, expressed that the agreement would not substantially diminish competition in the UK.
The announcement had a momentary impact on iRobot shares, prompting a temporary stall, while Amazon’s stocks experienced a modest 1.4% rise. The unfolding scenario reflects the intricate challenges and regulatory scrutiny that major tech acquisitions face, underscoring the potential implications on both the companies involved and the broader market landscape. As stakeholders await the European Commission’s ruling, the iRobot–Amazon deal remains under the watchful eyes of global regulatory bodies.
