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iRobot Faces Setback as EU Antitrust Watchdog Casts Doubt on Amazon

 |  November 27, 2023

Shares of iRobot took a nosedive by 19% on Monday after the EU’s antitrust watchdog raised concerns over Amazon’s proposed $1.7 billion acquisition of the Roomba maker. The European Commission, which initiated an in-depth probe in July, warned that the deal may pose competition issues in the market for robot vacuum cleaners. A ruling on the matter is anticipated by Feb. 14.

In response, Amazon’s spokesperson assured CNBC that the company is actively collaborating with the commission to address the concerns identified in the ongoing investigation. The spokesperson emphasized the potential benefits of the acquisition, stating that Amazon’s resources could fuel innovation and investment in crucial features, ultimately leading to lower prices for consumers.

Amidst the regulatory scrutiny, iRobot shares experienced a temporary halt on Monday afternoon. In contrast, Amazon’s shares saw a modest increase of about 1.4%.

Read more: EU Sends Amazon’s $1.65 Billion Bid To Buy iRobot For In-Depth Probe

It is noteworthy that the U.S. Federal Trade Commission is also reviewing the acquisition deal, adding an additional layer of scrutiny to this high-stakes transaction. However, the U.K.’s Competition and Markets Authority, in a statement from June, expressed confidence that the deal would not substantially diminish competition in the U.K.

The deal, announced by Amazon in August 2022, proposed a $61 per share, all-cash acquisition of iRobot. As both Amazon and iRobot navigate the complex regulatory landscape, the fate of this significant acquisition hangs in the balance, impacting the trajectory of the two tech giants in the robotics and home automation market.

Source: CNBC